Preamble

The House met at half-past Two o'clock

PRAYERS

[Mr. SPEAKER in the Chair]

Oral Answers to Questions — PRICES AND CONSUMER PROTECTION

National Consumers' Agency

Mr. Mike Thomas: asked the Secretary of State for Prices and Consumer Protection whether it is her present intention to ask the TUC and the CBI to nominate members of the National Consumers' Agency; and whether she will make a statement on the composition of the agency.

The Minister of State, Department of Prices and Consumer Protection (Mr. Alan Williams): The composition of the agency is still under consideration. But as indicated in paragraph 5 of the White Paper (Cmnd. 5726), the TUC and CBI represent the interests of those concerned in the production of goods and services whereas the role of the agency will be to give similar voice to the interests of the consumer.

Mr. Thomas: Does my hon. Friend agree that it is important that the agency should be independent of producer interests? Does he also agree that it is important that if it is to reach the status, described in the slim White Paper, of being equivalent to the CBI and the TUC, great thought must be given to its chairmanship, the composition of the committee and the stature of its members? Can the House be told fairly soon in a rather more detailed way than we have been told in the White Paper?

Mr. Williams: I agree completely with my hon. Friend that the independence of the agency must be clearly established. It is for this reason that we are considering the membership. First we want to

consult the prospective chairman, since he will to a great extent determine the success of the agency. We want to discuss with him the precise form of membership.

Mr. Raison: Can the Minister give us an assurance that the agency will not be set up before the House has had an opportunity to debate the White Paper on the subject which was published only a relatively short time ago? Can the hon. Gentleman explain a mystery which has been puzzling a number of us—namely, that in the Labour Party manifesto it is categorically stated that
 We have … set up a National Consumer Agency"?
It appears that the Government are about to set up a National Consumers' Agency. Is not this a case where the manifesto should be reported to the Director General of Fair Trading?

Mr. Williams: I do not recollect the passage which the hon. Gentleman mentions but I do not challenge the accuracy of what he says. All I would point out is that, since the White Paper was produced only in the late summer, it would, if anything, have been a printing error rather than an attempt to mislead since that was hardly the central point of the last General Election. As for the hon. Gentleman's request for a debate, I can understand his wish to have further discussion of the subject. I shall make the point to my right hon. Friend the Leader of the House but I cannot give any guarantee. I would point out that when the Consumer Council was set up it was the then Opposition—the Labour Party— which provided part of one of its own Supply Days for a debate on the issue. I do not think there has been a single Question about the National Consumers' Agency from any right hon. or hon. Member on the Tory Front Bench or back benches.

Food Subsidies

Mr. William Hamilton: asked the Secretary of State for Prices and Consumer Protection what plans she has for the further subsidisation of bread and other basic foods.

The Under-Secretary of State for Prices and Consumer Protection (Mr. Robert Maclennan): We are aware that, following the recent wage increases, plant bakers


have recently submitted notifications of price increases to the Price Commission. We shall consider the need for changes in the existing subsidies when the Price Commission has completed its examination of these and any other notifications.

Mr. Hamilton: Will my hon. Friend bear in mind that the subsidy, particularly of bread and certain other basic foods, is widely welcomed by the lower income groups? Will he also bear in mind that the recent, fully justified wage increases in the baking industry mean that if the bread subsidy is not increased its price will rise? Will he give an assurance that the price of bread will be stabilised by further subsidy if necessary?

Mr. Maclennan: I am grateful to my hon. Friend for recognising the value of the bread subsidy. The Government will have to decide whether to adjust the subsidy, and to what level, when the Price Commission has considered the relevant price notification.

Mr. Jim Spicer: Will the hon. Gentleman think for a moment about the problem of subsidies as they continue to grow, and will he think in partcular about milk? Will he accept that, if we go on creating a gap between the real price of milk and its subsidised price, we shall soon arrive at the point when people will say, as they are already saying, that milk is the cheapest form of dog and cat food available.

Mr. Maclennan: The hon. Gentleman will recognise that his own party when in government subsidised milk to the tune of £100 million per annum

Mr. Stanley: asked the Secretary of State for Prices and Consumer Protection whether she is satisfied that the expenditure on food subsidies is going to those in need of subsidisation.

The Secretary of State for Prices and Consumer Protection (Mrs. Shirley Williams): As I made clear to the hon. Member in a reply on 11th November, I am satisfied that as a result of changes in direct taxation the net benefit of the Government's expenditure on food subsidies goes to the lower income groups.—

Mr. Stanley: Will the Secretary of State consider again the implications of her

reply to me on 11th November in which she said that no less than 67 per cent. of the total expenditure on food subsidies went to those earning more than £2,000 a year? Will she acknowledge that the higher rates of direct taxation announced by the Chancellor of the Exchequer are no justification for the huge subsidisation of the better off by her Department?

Mrs. Williams: The hon. Gentleman has got the figures wrong. Fifty-two per cent. of the expenditure goes to those earning over £50 a week. The hon. Gentleman has entirely failed to take account of what I said in my reply with regard to the net benefit of subsidy. It will not do for the Opposition so consistently to present themselves as being unable to understand the concept of net benefit. The net benefit is overwhelmingly to lower income groups who do not pay additional tax.

Mr. Mike Thomas: What success is my right hon. Friend having in persuading her colleagues the Chancellor of the Exchequer and the Secretary of State for Energy that the same argument might be applied to the price structure in the nationalised industries, particularly electricity and gas?

Mrs. Williams: My hon. Friend will be aware that the Government have had to deal with the effect of huge and indiscriminate subsidies paid to the nationalised industries which made no distinction between the income groups concerned in paying those prices. The Government are endeavouring to see what they can do in this respect also.

Mr. Raison: Will the Secretary of State accept that in the present economic condition of the country we are in no position to go on increasing food subsidies indefinitely? Will she further accept that it is wrong to increase subsidies on commodities like bread to pay high rates of wage inflation?

Mrs. Williams: The hon. Gentleman and his colleagues must accept that there is a deep ambiguity in their position. Every month they complain about the rate of inflation, and every month they complain about the actions which the Government take to try to reduce it.

Mr. Raison: Will the Secretary of State now answer my question?

Mrs. Williams: I consider that I have answered it.

Mr. Gow: asked the Secretary of State for Prices and Consumer Protection if she will take steps designed to ensure that less than 52 per cent. of the estimated cost of food subsidies in the current financial year will be received by households with an income above £50 per week.

Mrs. Shirley Williams: The changes in direct taxation introduced by the present Government are ensuring that the cost of the food subsidies programme is borne by households with incomes of over £50 per week. It is not part of our policy to require people to undergo a means test before receiving the benefit of food subsidies.

Mr. Gow: Bearing in mind the words of her right hon. Friend the Prime Minister when he said that we were facing the gravest crisis since the war, does the right hon. Lady think it right in present economic circumstances that more than £250 million a year should go in subsidies to families with incomes of more than £50 a week?

Mrs. Williams: It is very difficult to get this point over to the Opposition, but I shall try again. The additional taxation on those earning more than £60 a week is greater than the benefit from subsidy. Therefore, it does not matter that they receive the subsidy, because they more than pay for it.

Mr. Michael Stewart: Does my right hon. Friend recollect that in the last Parliament there were several occasions when the Opposition could have voted against the food subsidies but that they could never quite bring themselves to do it?

Mrs. Williams: My right hon. Friend will recollect that in their manifesto the Opposition could not quite find it in themselves to announce that they would end food subsidies.

Mr. MacGregor: Does the right hon. Lady accept that the tax argument which she keeps using would apply only if the Government had made it clear that the increase in the higher tax rates was specifically to provide the food subsi-

dies? As that is not so, there are much better ways of applying that higher tax revenue—either by payment direct and in tola to the groups in need or perhaps to reduce the Government's borrowing requirement.

Mrs. Williams: My right hon. Friend the Chancellor of the Exchequer made clear in his March Budget for what purposes taxation was being raised, and food subsidies were among them. I repeat that the Opposition do not seem to grasp the point that in substantial part any means-tested benefit is not taken up by those whom it is intended to reach.

Local Authorities (Chief Officers' Salaries)

Mr. David Steel: asked the Secretary of State for Prices and Consumer Protection whether the study she is undertaking of penalties which might be imposed on employers who are in breach of guidelines laid down in the social contract will extend to cover the salaries paid to chief officers of local authorities.

Mrs. Shirley Williams: Action through the Price Code, which I am studying, can influence employers only so far as their prices or charges are controlled under the code. Only the trading services of local authorities are so controlled.

Mr. Steel: Is the right hon. Lady aware that there is considerable public concern about the quite provocative increases in the salaries of local government officials, particularly those who will be doing, under reorganisation, much the same jobs but with different titles? Can she say whether the proposed inflation tax which apparently is being considered by Ministers will be introduced in time to make sure that some of the increases will be repaid to the community, as we proposed during the last election?

Mrs. Williams: I can understand the hon. Gentieman's concern but the Price Code is probably not the best way to reflect it.

Packaging

Mr. McCrindle: asked the Secretary of State for Prices and Consumer Protection if she can estimate the average percentage of the retail prices of those commodities carrying a Government subsidy which relates to the cost of packaging.

Mr. Maclennan: I regret that no statistics are available on which to base an estimate of packaging costs for the subsidised foods. However, we are aware that packaging can account for a significant proportion of total costs, and we are considering what action may be necessary in this field.

Mr. McCrindle: Does not the Minister think it somewhat contradictory to subsidise foods only to find their cost increased by the cost of packaging? Will he engage in discussions with the manufacturers with a view to giving people a choice—either to pay the additional cost of fancy packaging and wrapping or to accept the goods rather less extensively packaged but at a price closer to their true cost?

Mr. MacLennan: I cannot accept the hon. Gentleman's view that subsidised foods in particular are fancily packaged. I think there is no evidence of that. The references to the cost of packaging made recently by the Price Commission were not references to the impact on subsidised foods.

Mr. Giles Shaw: Does the hon. Gentleman agree that many food companies already offer a wide variety of goods, some of which do not carry a packaging premium? Does he also agree that, with a delivery cost of 4½p for first-class letters as against 5p for a pint of milk, the consumer has reason to doubt whether in the Government's view the cost of packaging or the content is more important?

Mr. Maclennan: The hon. Gentleman makes a valid point in that it is impossible to reduce the cost of packaging of milk. The bottle would seem to be the necessary minimum.

Mrs. Sally Oppenheim: asked the Secretary of State for Prices and Consumer Protection what steps she is taking to investigate the inflationary effects of excessive packaging of consumer goods.

Mr. Maclennan: I am anxious to ensure that packaging does not unnecessarily lead to increased prices for the consumer and I am considering the matter urgently.

Mrs. Oppenheim: I am grateful for that reply, but would not the hon. Gentleman agree that whereas it is necessary

to ensure that packaging protects and preserves foods and other goods adequately and hygienically, it not only adds to costs but often misleads consumers and creates an environmental problem? Does not the hon. Gentleman further agree that whereas it is not desirable that there should be statutory restrictions on packaging, it would be very useful if an independent inquiry could be set up by the hon. Gentleman's Department into the extent and cost of packaging, to assist the Director General of Fair Trading to arrive at an agreement with the trade on a voluntary code on packaging?

Mr. Maclennan: The hon. Lady mentions a number of factors which we are looking at carefully. She will be aware that the Government published a Green Paper on waste and that we are setting up the Waste Management Advisory Council which doubtless will look into some of the factors she has mentioned. The hon. Lady particularly addressed me on the cost aspect, and I am considering this myself.

Mr. Cormack: Will the hon. Gentleman undertake to ensure that the somewhat quaintly named Waste Management Advisory Council is asked to devise an economic packaging standard along the lines of the "kite" system?

Mr. Maclennan: That must be a matter for the Waste Management Advisory Council to consider for itself and to come up with recommendations to the Government.

Cost of Living

Mr. Adley: asked the Secretary of State for Prices and Consumer Protection what was the increase in the cost of living over the past three months.

Mr. Rost: asked the Secretary of State for Prices and Consumer Protection what is her latest estimate of the increase in the retail price index for the 12 months to November, and for the three months to November.

Mr. Alan Williams: The retail price index for November was 18·3 per cent. higher than the figure for 1973. The increase over the three months to November was 4·9 per cent.

Mr. Adley: Why is it that senior Ministers increasingly are ducking Questions and are not themselves answering obviously embarrassing Questions which are put to them? Will the hon. Gentleman tell the Secretary of State for Prices and Consumer Protection that we all admire her charm and skill but that neither her words nor those of her colleagues can possibly compensate pensioners and people on fixed incomes for the appalling and staggering increase in the cost of living? Will all the Ministers on the Government Front Bench get together and try to persuade their colleagues in the Cabinet to do something about introducing an effective incomes policy?

Mr. Williams: The hon. Gentleman is absolutely wrong if he thinks that my right hon. Friend the Secretary of State would duck a Question. The whole House knows the absurdity of that suggestion. As the hon. Gentleman will probably appreciate, and certainly as his hon. Friends on the Opposition Front Bench appreciate, in allocating the answering of Questions there must be a balance in numbers between Ministers and we must try to ensure that the same Ministers are not popping up and down in succession to answer Questions. The hon. Gentleman should put the Question about an incomes policy to another Minister.

Mr. John Garrett: Will my hon. Friend say what apparent effect food hoarding has had on the cost of living index in the last three months?

Mr. Williams: I am not sure that it has had much effect on the cost of living index. It seems to have had a considerable impact on the leadership prospects of certain politicians on the Opposition Front Bench.

Mr. Rost: As the Secretary of State told shoppers on 7th October during the election campaign that price rises were slowing down at a time when the Chancellor of the Exchequer was saying that the rate of inflation was 8·4 per cent., since when price rises have doubled, what does the Secretary of State say now?

Mr. Williams: Last month's price increase was still lower than that in January when the Conservative Party was in office. There were two important abnormal factors on the food side. One concerned milk. Conservative Members

had been shouting and demanding in the House that the return on milk to the producer should be increased. The other factor concerned sugar. The world price of sugar has passed through into manufacturers' costs of biscuits, sweets and so on.

Mrs. Sally Oppenheim: As the now notorious three-monthly rate of inflation of 8·4 per cent. quoted by the Chancellor of the Exchequer and the Secretary of State for Prices and Consumer Protection in the election has in two months increased to a three-monthly rate of 21·3 per cent., can the hon. Gentleman's right hon. Friend tell the House precisely which of the main factors which have contributed to this increase she was unaware of when she made that statement and when she said on radio that all she could say about inflation was that it was beginning to move downwards? Is she aware that the 9½month period of dreamland, fairy-story government is over and that it is becoming a waking nightmare for the people because it is now clear to everybody that the Government have no effective plans for tackling inflation, that they duped the electorate about the impending rate of inflation, duped them about the social contract and duped them about the economic situation?

Mr. Williams: I thought that the hon. Lady was going to blow a gasket. [AN HON. MEMBER : "It is not funny."] It is not funny. Frankly, it has been depressing week after week to listen to the Opposition knocking every action taken by the Government to try to contend with the prices situation but never coming forward with a positive suggestion themselves.

Petrol Retailers

Mr. Leslie Huckfield: asked the Secretary of State for Prices and Consumer Protection whether she has yet received the report of the Price Commission on petrol retailers' margins; and whether she will make a statement.

Mr. Maclennan: We do not expect to receive the report of the Price Commission until the early part of next year.

Mr. Huckfield: With regard to certain Press reports yesterday, is my hon. Friend aware that even at present price and profit margins some garages are doing


very well—in fact, so well that they can afford to give away Green Shield stamps, glasses and goodness knows what? Will he accept that what is wrong is that 70 per cent. of retail sales outlets are owned by the major oil companies? Does he not think it is time that another look was taken at the undertaking which they gave the Monopolies Commission in 1965 that they would not acquire any more?

Mr. Maclennan: I could not accept what my hon. Friend has said in the first part of his supplementary question without having the full report of the Price Commission with me. It may be that in part it will substantiate what he has said. But I must maintain an open mind on that matter. We are considering the point which my hon. Friend has raised in the second part of his supplementary question.

Local Consumer Protection Services

Mr. Hooley: asked the Secretary of State for Prices and Consumer Protection how many local authorities now offer some form of consumer protection service to their own ratepayers.

Mr. Alan Williams: All local weights and measures authorities enforce a wide range of consumer protection legislation. There are now 46 local authority consumer advice centres and there are plans for others.

Mr. Hooley: Is my hon. Friend aware that consumer advice and protection at local level is extremely important? What sanctions are open to local authorities if they find that traders are offending against good practice in consumer matters?

Mr. Williams: I agree completely with my hon. Friend that it is absolutely essential to have effective consumer protection at local level. Indeed, that is where it becomes meaningful to the consumer. The question of sanctions depends on the nature of the practice. Generally the first line of action is to approach the local weights and measures or trading standards inspectors. They are able to take action if necessary. There is also the facility of being able to draw continued abuses to the attention of the Director General of Fair Trading, who can make recommendations to the Government, as

he has done, concerning the introduction of orders to make certain activities illegal.

Mr. Michael Latham: Can the hon. Gentleman think of a better form of protection for ratepayers than for local authorities to hold down the level of their expenditure?

Mr. Williams: The hon. Gentleman must bear in mind, as all hon. Members must bear in mind at some time, that there is always a balance between how far we should hold down expenditure and how far we should cut back services. Holding down expenditure is not always the most advantageous course in the long run from the consumer's point of view. It is a delicate balance. We can leave it to the local authorities to do what they think appropriate with regard to consumer protection.

Mr. Ward: In view of the economic restraints preventing many authorities from progressing with their consumer advice centres as they would wish to do, does my hon. Friend agree that it is time to consult the local authority associations about how the practices of the best authorities can be disseminated among the other authorities and how greater cooperation can be arranged between adjoining authorities to make the most economic use of the existing facilities?

Mr. Williams: Certainly such a meeting would be helpful, and it is our intention to invite local authority representatives to discussions with us during the new year. We have already held one such meeting and we hope that we can have a further constructive exchange.

Mr. Ridley: Is the Minister aware that the Secretary of State for the Environment last Thursday from the Box adjured all local authorities to reduce expenditure and to economise in staff? As the Minister is now encouraging them to spend more on consumer protection, will he have a word with the Secretary of State for the Environment to see which of them will prevail in this internecine struggle?

Mr. Williams: There is no internecine struggle. Struggles between individual hon. Members seem to take place nowadays among Conservative Members. Consumer protection is covered in the rate support grant.

Food Manufacture (Small Companies)

Mr. Alison: asked the Secretary of State for Prices and Consumer Protection what monitoring of the effect of the cash flow position of smaller food manufacturing companies caused by price controls is undertaken by her Department; how many redundancies or closures have occurred in this context; and if she will make a statement.

Mrs. Shirley Williams: I keep in close touch with my right hon. Friends the Minister of Agriculture, Fisheries and Food and the Secretary of State for Employment about cash flow and employment in the food manufacturing industry and I have carefully considered many representations from the industry during the current review of the Price Code. While there have been some redundancies and closures over the last 12 months it is impossible to say to what extent the Price Code is responsible as opposed to other factors.

Mr. Alison: Has the right hon. Lady heard about the closure of Anglia Canners Company at Wetherby in my constituency, which was directly due to the operation of the Price Code? Is it not perverse of the Government to facilitate a growth in consumer expenditure while at the same time making it impossible for producers to produce the goods and services on which consumers can spend money?

Mrs. Williams: The hon. Gentleman may know that there have been redundancies and closures in the food manufacturing industry for many months past, long pre-dating the present administration and pre-dating the Price Code. Market factors are at least as important at present as is the Price Code, and I suspect considerably more so. But we are endeavouring to ease the Price Code at least to some extent to meet the problem of unemployment in this field.

Mr. Richard Wainwright: Will the right hon. Lady tell the House when she expects, by publishing the revised Price Code, to end the suspense in which these manufacturers find themselves?

Mrs. Williams: Yes. The hon. Gentleman will be pleased to know that the

revised Price Code will be laid before the House on Wednesday.

Mr. Giles Shaw: In view of the representations which the right hon. Lady has had from the food industry, may I ask whether she is aware that, despite the concessions made to it both in the Price Code and the Budget, the net cash outflow in the industry is many millions of pounds? Will she take this into account in deciding the final amendments she makes to the Price Code so as to protect the variety and supply of food in our shops?

Mrs. Williams: The hon. Gentleman will be aware that that is one matter which we have taken into account in our discussions and consultations about the Price Code. I also have a great responsibility to try to reduce the effects of the increased rate of inflation and, therefore, we cannot go all the way to meet what the industry wants.

Sale of Goods (Prescribed Quantities)

Miss Fookes: asked the Secretary of State for Prices and Consumer Protection what progress she is making with the extension to a wide variety of goods of the provision to sell them in prescribed standardised quantities.

Mr. Alan Williams: Formal consultations were opened last week on proposals relating to biscuits and shortbread. In the new year I also expect to be able to announce plans for wine sold both by the carafe and by the glass and for implementing the EEC range for chocolate bars.

Miss Fookes: I welcome these signs of progress, but my I ask the Minister to speed it up because we seem always to move at a snail's pace in these matters?

Mr. Williams: The hon. Lady is absolutely correct. It is frustrating for Government as well as Opposition. She will be aware of the contraints imposed by the 1963 Act which require consultation with all interested parties, so that the Department faces what are known as the "102 steps" which are necessary to prepare such a measure. The difficulty is that in the process of speeding up the orders, which will be long-lasting in their effect, if one cuts down the consultation one may do irreparable harm to an


interest which one does not wish to damage.

Mr. Ward: In making such arrangements will my right hon. Friend bear in mind the problems of pensioners who have to buy small quantities to keep within their limited incomes?

Mr. Williams: I am grateful to my hon. Friend for raising that matter. We are very conscious of it in the Department. The EEC has stressed this when ranges have been considered and has sought to have small sizes included.

Mr. Cormack: Will the hon. Gentleman accept that 39 steps are probably better than 102, and will he tell us how far he has got with unit pricing?

Mr. Williams: The hon. Gentleman and I have followed the saga of unit pricing for a long time. He will be aware that certain measures have been introduced since the Government came to office, and we are considering where else unit pricing would be appropriate. I think the hon. Gentleman shares the view of most of his hon. Friends and most of my colleagues that, in general, prescribed quantities are preferable, but these are instances where unit pricing is the only effective means of protection.

Special Offers

Mrs. Hayman: asked the Secretary of State for Prices and Consumer Protection whether she will take measures to stop the abuses in pricing policy on certain goods currently caused by "special offers "which in fact work to the disadvantage of the consumer.

Mr. Alan Williams: The Director General of Fair Trading has invited evidence on misleading price comparisons, including abuses of the kind my hon. Friend has in mind, with a view to a possible reference to the Consumer Protection Advisory Committee. I am sure that he will be glad to receive any representations she cares to send him.

Mrs. Hayman: I am grateful to my hon. Friend for that reply and I shall make representations to the Director General. Shoppers are extremely irritated when they find that a commodity price, apparently 2p less that it was the week before, is in fact lp more and that the item can be bought more cheaply at the

shop next door. Is my hon. Friend aware that this ludicrous method of trying to induce shoppers to buy a certain brand leads to such anomalies as the packet of soap powder which I bought this week which was marked "Special low price"?

Mr. Williams: My hon. Friend is correct. Unlike the Liberal spokesman, I actually do some of the family shopping and I am fully aware of the annoyance produced by the practice described by my hon. Friend. Even this morning I spoke to the Director General about this matter, and he assures me that he hopes to bring forward recommendations early in the new year. There will then have been consultation on the recommendations. There is action in the now famous pipeline.

Mr. McCrindle: On the other side of the coin, has the Minister any comment to make on supermarkets which recently have been prepared to provide scarce commodities such as sugar only in return for a minimum amount of spending by their customers? Does the hon. Gentleman agree that such a practice is unfortunate for old-age pensioners and people on fixed incomes? Has he plans to make a recommendation to discourage that practice?

Mr. Williams: There is a Question on this subject on the Order Paper which it would be improper for me to anticipate.

Miss Fookes: Is the Director General of Fair Trading taking into account my bête noire, the manufacturers' recommended price, which I believe should be abolished?

Mr. Williams: Yes, indeed, he is taking that into account. If the hon. Lady has examples of gross bêtes noires which she would like to put before the Director General I shall be delighted to hear of them.

Later—

Mr. McCrindle: On a point of order, Mr. Speaker. When I put a supplementary question on Question No. 16, I was told that the matter I had raised would be answered in reply to a later Question. May I know which Question between Question 17 and Question 28 refers to the matter I raised?

Mr. Alan Williams: Further to that point of order. As I made the point, I invite the hon. Gentleman to look at Question No. 18. I was not trying to dodge the hon. Gentleman's question. I would gladly have answered it, but it would have been discourteous to the hon. Gentleman who asked the other Question, had he been present.

Milk Subsidies

Mr. Ridley: asked the Secretary of State for Prices and Consumer Protection what is now the total annual cost of subsidies to milk.

Mr. Maclennan: About £323 million in the current financial year.

Mr. Ridley: Is the hon. Gentleman aware that that is 5 per cent. of the Government's deficit? Does he not agree that if the Government were serious in wanting to make some impact on inflation the best way to do it would be to cut out milk subsidies altogether, and quickly?

Mr. Maclennan: I must again remind the hon. Gentleman, who was a member of the Conservative administration and should be aware of this, that his own Government subsidised milk to the tune of £100 million per annum. It is an important element in the diet particularly of the less well off, and it is necessary in the inflationary situation in which we are living to seek to protect those members of our society.

Mr. Mike Thomas: Is my hon. Friend aware that those of us on this side of the House who take a serious interest in the well-being of our constituents can think of a hundred items on which we would cut a subsidy before we would cut a subsidy on milk?

Mr. Maclennan: I am grateful to my hon. Friend. I am sure he is right.

Mr. Scott-Hopkins: Surely it must be wrong that the price of milk should be less than the price of a bottle of bitter lemon and about one-quarter of the price of a pint of beer. Surely something is wrong with the hon. Gentleman's mathematics and proportions. Is it not about time that the real price was paid for a pint of milk? Is it not time that the subsidy ended?

Mr. Maclennan: Is the hon. Gentleman seriously suggesting that the nutritional

value of bitter lemon or beer is greater than that of milk? Surely he must recognise that milk is an important item in the diet of the less well off, the young and the elderly, and as such it is a most appropriate candidate for subsidy.

Mr. Woodall: Does not my hon. Friend agree that we should increase the subsidy on milk in order to restore the milk which was pinched from the kids by the last Conservative administration?

Mr. Maclennan: We shall have to consider the level of subsidy for milk in the new year in the light of any decision that may be taken about increasing producers' prices.

Sugar

Mr. Michael Latham: asked the Secretary of State for Prices and Consumer Protection what effect the recently announced arrangements for purchasing sugar will have on the food price index.

Mr. Maclennan: Following the agreement to pay £140 per ton fob to Commonwealth sugar suppliers for shipments between 1st September 1974 and 31st December 1974, the average retail price of a 2-1b. bag of granulated sugar has risen by 4½p. The price of sugar next year will depend on a number of factors including the outcome of price negotiations with Commonwealth suppliers and the quantities subject to the EEC subsidy scheme. An increase of 1p in the retail price of the 2-lb. bag of granulated sugar raises the food index by 0·16 points.

Mr. Latham: How much of the weekly benefit of food subsidies will be wiped out by the increase in sugar prices during the next 12 months?

Mr. Maclennan: The hon. Gentleman will know that it is impossible for me to answer that question until the level is settled, and this depends on the current negotiations with the Protocol 22 countries and on the outcome of the Lardinois proposals.

Mr. William Hamilton: Does my hon. Friend recognise that in view of the rotten state of the nation's teeth—particularly children's teeth—and the growing obesity among older people, sugar is one commodity that ought not to be subsidised?

Mr. Maclennan: It is true that we as a nation eat substantially more sugar than other countries. I have no doubt that from the point of view of that consideration my hon. Friend's remarks are justified.

CBI (Price Code)

Mr. Tim Renton: asked the Secre-tar of State for Prices and Consumer Protection what form her invitation took, to the CBI, to become participants in the social contract in relation to the Price Code.

Mrs. Shirley Williams: I wrote to the CBI on 12th November inviting its views on all aspects of the consultative document on the review of the Price Code, and I discussed it with the CBI on 28th November.

Mr. Renton: Does not the right hon. Lady agree that at the present time of extreme inflation it is essential that both employers and unions alike should be party to any social contract that is worth while? Will the right hon. Lady tell the House at what level of wage inflation 25 per cent. or 30 per cent.—she would think it appropriate to reapproach the TUC and the CBI to suggest some new form of restraint based on statutory controls of wages and prices?

Mrs. Williams: The hon. Gentleman will be aware that I explored with the CBI the possibility of linking the productivity deduction to the level of labour unit costs, but it did not want to proceed with the matter. With regard to the second part of the hon. Gentleman's supplementary question, that is a matter for my right hon. Friend the Secretary of State for Employment and not for me.

Mr. Richard Wainwright: Does not the right on. Lady agree that, while there is no harm in consulting the CBI and seeking its views, there can be no purpose in attempting to get its signature to the social contract when it would have no power to make any subject obey the contract?

Mrs. Williams: That is one of the problems which the CBI faces in this respect.

Price Code

Mr. Peter Morrison: asked the Secretary of State for Prices and Consumer Protection if she will make a statement on her plans for implementing paragraph 13 of the Price Code.

Mrs. Shirley Williams: I did so in the debate on 2nd December.

Mr. Morrison: Is the right hon. Lady aware that, desipte the sliding scale, the average company will face a 20 per cent. productivity deduction? Is she further aware that for the most efficient company this must mean a reduction in profit margins, which will lead eventually to redundancies and possibly shortages?

Mrs. Williams: Once again, the hon. Gentleman will be aware that there is a difficult line to tread in these matters. The 50 per cent. productivity deduction was, in the Government's view, too great for companies to bear if there was not to be a substantial increase in unemployment. Consequently we reduced the productivity deduction, but it is the main plank of a price restriction machinery and therefore it would have been most unwise at this stage to do away with it.

Mr. Raison: As the right hon. Lady knows, during the debate on the Consolidated Fund Bill the other day the Undersecretary talked about a new Prices Bill. Can the right hon. Lady give an assurance that a new Prices Bill will not contain a version of Section 13, and will she explain what the Bill will contain and why it is needed?

Mrs. Williams: The hon. Gentleman will discover that the existing Prices Act has within it the possibility of extending its powers with regard to subsidy. There is, however, a figure in it of £700 million. It would require a Bill to be put before the House if that figure were to be raised to allow subsidies to continue even at their present level for a further period. Therefore, the Bill would be largely a technicality.
With regard to Section 13, that matter does not arise. It was a matter for the review of the Price Code. Therefore, if any further action had to be taken on it, it would be a matter for discussion with both sides of industry before anything further was done.

Food Subsidies (Cost)

Mr. Neubert: asked the Secretary of State for Prices and Consumer Protection what is the latest estimate of the total cost of food subsidies for the current financial year.

Mr. Maclennan: About £503 million.

Mr. Neubert: Does not the hon. Gentleman now accept that he cannot single-handed, by open-ended subsidies, stem both the causes and the effects of inflation? With price increases running at an annual rate of 18 per cent. and wage increases running since July at an average of 24 per cent., is it not high time that the Minister made representations to the Secretary of State for Employment, that custodian of the social contract, reports of the existence of which are greatly exaggerated, that he should fulfil his part of the bargain?

Mr. Maclennan: The hon. Gentleman misrepresents the situation in speaking of the open-ended nature of subsidies. The financial limits to the subsidy programme have been made clear. The subsidies offer a valuable contribution to holding the rise in the retail price index. They are saving over one and a half points on that index and six points on the food index.

Mr. Tomlinson: Does my hon. Friend agree that people who are concerned about the public borrowing requirement can find alternatives to scrapping the subsidy programme, and that those alternatives will be found when my right hon. Friend the Chanccellor of the Exchequer introduces the wealth tax and so raises the revenue for subsidies by taxation?

Mr. Maclennan: Almost every hon. Member has his own views on how best to limit the borrowing requirement. The Government's priorities are different from those of the Opposition.

Mr. Cormack: Will not the hon. Gentleman acknowledge that his Government are stoking the fires of inflation by this prodigal waste of public money? Will he come clean, realise that the election is over and discard the most expensive camouflage for which the public have ever had to pay?

Mr. Maclennan: The hon. Gentleman and his hon. Friends refuse to recognise

that the least-well-off members of our community must be the first charge upon the Government in their attempt to protect them from the rise in the cost of living. The subsidy programme is an important contribution to that, and we shall maintain it for that reason.

Advertising

Mr. Ioan Evans: asked the Secretary of State for Prices and Consumer Protection if she will make a statement on her proposals to test advertising claims and to control false, misleading and wasteful advertising.

Mr. Alan Williams: Existing legislation, notably the Trade Descriptions Act 1968, gives the consumer substantial protection against misleading claims. As already announced, the Act's provisions are being reviewed. Meanwhile we are watching closely the steps the advertising industry is taking to strengthen its own system of control and whether further statutory controls will be necessary.

Mr. Evans: Does my hon. Friend agree that, at a time when we should be importing less and exporting more, we should look again at the increasing advertising by foreign manufacturers encouraging people to spend more? In particular will he examine the pharmaceutical industry, where people are being encouraged to buy medicines which are at best useless?

Mr. Williams: The Medicines Act and the Food and Drugs Act lay down certain requirements with regard to advertising in the pharmaceutical sector, and the Trade Descriptions Act gives additional protection. But if my hon. Friend, who I know follows these matters closely, lets me have examples of the specific abuses of which he complains, I shall gladly examine them.

Diabetic Foods

Mr. Dodsworth: asked the Secretary of State for Prices and Consumer Protection if any considerations of medical necessity are taken into account when her Department is considering price increases on diabetic foods.

Mr. Maclennan: In scrutinising proposals for price increases on diabetic foods, the Prime Commission applies the same criteria as it does to other products.

Mr. Dodsworth: Will the Minister bear in mind that people who require diabetic foods are by definition restricted in their shopping alternatives and opportunities, and that increases in price of more than 50 per cent. have borne very heavily upon diabetics of all income groups, because diabetic necessity qualifies itself not by income group but by medical conditions?

Mr. Maclennan: Diabetics benefit from the Government's subsidy programme and can eat most of the foods on the subsidy list. However, most of the foods specially used for diabetics are intended to vary their diet. I recognise that there have been substantial cost increases for the industry in raw material prices in particular. It would be difficult for us to subsidise them away.

Oral Answers to Questions — TRADE

Court Line (Holiday Payments)

Mr. Stanley: asked the Secretary of State for Trade when those who lost advance payments on holidays as a result of the collapse of Court Line will be recompensed; and whether he will make a statement.

The Under-Secretary of State for Trade (Mr. Eric Deakins): I would refer the hon. Member to the reply to a similar Question by the hon. Member for Derbyshire, South-East (Mr. Rost) on 18th November.—[Vol. 881, c. 886.]

Mr. Stanley: As the Minister's Department has now admitted responsibility for the sums lost by holidaymakers who booked with Court Line, will he say whether, when the sums are eventually repaid, repayment will be made with interest accrued from the date of the Government statement in July?

Mr. Deakins: There has been no admission of responsibility of which I am aware. The matter of what sums are to be repaid to the holidaymakers will have to await the legislation that my right hon. Friend the Secretary of State will introduce soon after the Christmas Recess.

Mr. Adley: Was the hon. Gentleman or his Department aware that the difficulties over Court Line had been going on for years? Was he aware of the problem of building hotels on the wrong side of the island of St. Lucia

of the problems of LIAT and Clarksons and of the over-enthusiasm in buying TriStars? Is he not aware than many people have been given the impression that his Department suddenly found itself confronted with a novel difficulty in the case of Court Line? Will he please give us an answer to this question?

Mr. Deakins: I am well aware of the deficiencies of a great deal of private enterprise in this country, as instanced by the Court Line collapse. However, it is not for my Department so closely to monitor the activities of every firm within its field in a way that perhaps the directors should be doing but are not.

Mr. Raphael Tuck: Can my hon. Friend explain why, when nationalisation of any industry is mooted, the Opposition utter cries of terror but when a private enterprise company goes on the rocks they expect the Government to take full responsibility for it?

Mr. Deakins: I entirely endorse what my hon. Friend says in his supplementary question.

Mr. Higgins: Does the Minister propose that the compensation should be paid out of the payments of future holidaymakers, or be paid by the taxpayers or his right hon. Friends the Secretary of State for Industry and the Secretary of State for Trade?

Mr. Deakins: I ask the hon. Gentleman to await the details of the scheme, which will be available fairly early in the new year when my right hon. Friend introduces the Tourist Reserve Fund Bill. There will then be a full opportunity to debate all these matters and go into the details for which the hon. Gentleman has asked.

Agricultural Imports (EEC Countries)

Mr. James Spicer: asked the Secretary of State for Trade what was the total value of agricultural imports from the EEC in the first nine months of this year and the percentage increase this represents over the corresponding period for 1973.

Mr. Deakins: Agricultural imports— Section O of SITC(R)—from the EEC, including transhipments, in the first nine months of this year were valued at £1,072 million, 57 per cent. higher than in the same period last year.

Mr. Spicer: I am grateful to the Minister for giving us those figures. Will he confirm that we should all be grateful for that increase, as are our farmers, and in particular for the 90 per cent. increase in the maize exports from the Community to this country, which made up for the shortfall from the American continent and without which the cost of feeding stuffs this winter would be considerably higher?

Mr. Deakins: Certainly our farmers have every reason to be grateful for the make-up in the shortfall of supplies. That also applies to butter. But I am not certain whether the consumers will be entirely happy with, for example, beef imports which might have come more cheaply from other countries.

Mr. Body: What proportion of the imports could we have purchased more cheaply from outside the Community?

Mr. Deakins: It would be very difficult to isolate any one sector. Three main areas—cereals, dairy products and beef— account for the bulk of the increase. It is difficult to separate one from the other because one has to take into account first the price relationships, secondly the volume increases, and thirdly the decrease in the value of sterling. It is a very complicated matter.

Mr. William Hamilton: Can my hon. Friend be more specific? Where could we have got these things cheaper than in the Community?

Mr. Deakins: There is plenty of beef available on world markets. I was referring to the fact that for several months past and for several months to come the Community has been, is and is likely to be closed to beef imports from the rest of the world.

Tariffs

Mr. Tom Ellis: asked the Secretary of State for Trade whether he will give an estimate of the overall effect of the changes in United Kingdom tariffs due on 1st January next designed to bring the United Kingdom more into line with the EEC common external tariff.

Mr. Deakins: The overall effect of the changes being made on 1st January in duties on imports from non-Community countries is expected to be very small.

Mr. Ellis: Is my hon. Friend aware that his answer will be received with great pleasure by a large number of people? Does he agree that the net effect of our internal tariffs, taken together with the Community subsidies on imports from third countries, has so far been appreciably less than lp in the pound?

Mr. Deakins: I think that my hon. Friend is slightly mistaken. There are no Community subsidies other than those on sugar on imports from third countries, and to set against that one must remember that there are duties and levies on agricultural imports from third countries, which rather complicates the matter.

Mr. Marten: Why is there to be an increase in import tax on lambs from third countries?

Mr. Deakins: Because that is part of the Treaty of Accession obligations which we accepted on entry. We are bound by the treaty. We cannot change it. But I do not think that this further move will in any way prejudice the Government's attitude in renegotiation.

Mr. Jay: Is my hon. Friend aware that, if it were not for the ban on beef imports from outside the Community, we could buy beef more cheaply from Australia, New Zealand, Brazil, Argentina, Poland, Yugoslavia and several other countries?

Mr. Deakins: We could buy certain commodities more cheaply, but, to be fair, I must point out that there are also commodities that we can buy currently in the Community more cheaply because of the relationship between the EEC and world prices at present in those commodities.

Mr. Higgins: Is it not a question of the overall effect? Taking individual items is a deceptive way to look at the situation. Is the overall effect to increase or to decrease the rate of increase in the cost of living?

Mr. Deakins: The overall effect of changes of duties on imports from non-Community countries is very little. If one were to take into account, which Question No. 33 does not, changes in duties, including changes in intra-Community traffic, there would be a reduction.

Oral Answers to Questions — ENERGY

Romanian Oil

Sir J. Langford-Holt: asked the Sec-retary of State for Energy, in view of the shortage of oil, whether he will now reconsider the refusal of his predecessors to allow imports of Romanian oil until compensation has been received for the seizure by Romania of British assets, since agreements are made with other East European countries who have made such seizures.

The Under-Secretary of State for Energy (Mr. Alex Eadie): No, Sir. There is no physical shortage of oil. There are no grounds for lifting the embargo, since an important part of the claims made for compensation remain unresolved.

Sir J. Langford-Holt: Will the hon. Gentleman bear in mind that some 18 months ago I was told by the last Government that they were pressing for a settlement, that there had been two rounds of negotiation and that they expected that the Romanian Government would shortly be making a satisfactory offer? What has happened to that satisfactory offer?

Mr. Eadie: The hon. Gentleman is aware that the present Government cannot accept responsibility for a previous Government. It is true that discussions were going on, but they still remain unresolved.

Oral Answers to Questions — SOCIAL SERVICES

Beef Subsidy

Mr. Scott-Hopkins: asked the Secretary of State for Social Services what steps her Department is taking to publicise the EEC's social beef consumer subsidy.

Mr. James Spicer: asked the Secretary of State for Social Services what steps her Department is taking to publicise the social beef EEC consumer subsidy.

The Under-Secretary of State for Health and Social Security (Mr. Alec Jones): Advertisements appeared in national daily and Sunday papers between 14th and 18th November, and posters were displayed in post offices from 11th November. Tokens were issued automatically to eligible beneficiaries.

Mr. Scott-Hopkins: What has been the take-up since the initiation of this scheme? Will the hon. Gentleman make it clear that pensioners can use these tokens for other meat commodities as well as for beef? There seems to be some confusion about the matter.

Mr. Jones: It was made clear that the tokens would be available for beef and veal. It is too early to know the extent of the take-up, but all those entitled to the tokens have been advised about how they can get them.

Oral Answers to Questions — AGRICULTURE, FISHERIES AND FOOD

Dressed Poultry

Mr. Scott-Hopkins: asked the Minister of Agriculture, Fisheries and Food what representations from the Consumers Association he has received about the continuing sale of New York dressed poultry.

The Parliamentary Secretary to the Ministry of Agriculture, Fisheries and Food (Mr. Gavin Strang): Representations have been received from several consumer interests. Most of them, but not the Consumers Association, have supported continuation of the New York dressed trade.

Mr. Scott-Hopkins: Do I understand that the hon. Gentleman is prepared to accept the date of 1982 for the abolition of New York dressed poultry? Is he aware that many of us were pressing for, and almost succeeded in getting, the exclusion of the United Kingdom from this harmonisation? Will he press the Council of Ministers that there should be optional and not total harmonisation?

Mr. Strang: The hon. Gentleman will be aware of the previous announcements which have been made with regard to 1982. He will also appreciate that there will still be some scope for this trade in sales directly from the farmer to the consumer after 1982.

Mr. Cormack: That answer is not good enough. Is it not time that the Government supported what my hon. Friend the Member for Derbyshire, West (Mr. Scott-Hopkins) has said? It is intolerable that the British housewife should have only another five or six years in which she can buy


New York dressed poultry, to which we are traditionally accustomed. Will the hon. Gentleman look at this matter again and do something positive?

Mr. Strang: I can understand the hon. Gentleman's attitude, but there is nothing that I can add now to what has been said.

Mr. Marten: Is not this purely an example of fussy interference by mandarins in Brussels? Do we need to have this legislation at all? Have we ever asked for it?

Mr. Strang: We have not asked for the legislation, but I think the hon. Gentleman will accept that there are some good things in this harmonisation and that there will be some raising of health standards by it. I take the point that it is regrettable that the trade in New York dressed poultry will have to decline after 1982.

Oral Answers to Questions — NATIONAL FINANCE

Nationalised Industry Prices

Mr. Giles Shaw: asked the Chancellor of the Exchequer what effect he estimates the proposed increases in nationalised industries' prices will have on the retail prices index.

Mr. Speaker: The Chancellor of the Exchequer.

Hon. Members: Where is he?

The Lord President of the Council and Leader of the House of Commons (Mr. Edward Short): I must apologise, Mr. Speaker, for the fact that for some reason or other my right hon. Friend the Chancellor of the Exchequer is not here.

Mr. Heath: On a point of order, Mr. Speaker. Would it not be in order for the Prime Minister, as First Lord of the Treasury, who is present, to answer the Question?

The Prime Minister (Mr. Harold Wilson): The Question is extremely important. I will discuss it with my right hon. Friend the Chancellor of the Exchequer and see that the House is given the best estimate available.

Sir David Renton: While congratulating the First Lord of the Treasury upon

his impromptu reply, may I ask him a very serious supplementary question? Can he tell us why we should go on putting up for ever with self-inflicted wounds arising from the fact that when the price of coal goes up, the price of electricity goes up, and that when the price of electricity goes up the price of coal goes up, and the nationalised industries go chasing each other's prices for ever upwards at the expense of the consumers and to the detriment of the economy?

The Prime Minister: I think that in putting that question the right hon. and learned Gentleman should have regard to the statement made in the House on 17th December last year—just a year ago—when the then Chancellor of the Exchequer said that the Treasury could no longer go on subsidising nationalised industries and that prices must relate to total costs.
My right hon. Friend the Chancellor of the Exchequer dealt with this matter in his Budget Statement in March and said what he thought that would mean on the estimates then available. It has now become clear that it will cost more to carry out the intentions announced by the then right hon. Member for Altrincham and Sale, now Lord Barber of somewhere or other.

Mr. Shaw: I am grateful to the Prime Minister for answering so nobly the Question addressed to his colleague the Chancellor of the Exchequer. May I ask two brief supplementary questions? As nationalised industry prices are to be adjusted by subsidies being removed, why do the Government still believe that food subsidies as a policy for keeping prices down are so much better for that part of the economy?

The Prime Minister: Because, as the hon. Gentleman will be aware, the effect on the cost of living of the average family in relation to so many millions of pounds subsidy, in relation to so many points on the cost of living, is more serious in the case of food.

QUESTIONS TO MINISTERS

Mr. Michael Latham: On a point of order, Mr. Speaker. During Question Time you ruled on a point of order raised


by my hon. Friend the Member for Brentwood and Ongar (Mr. McCrindle) about a supplementary question he had not been able to put because the Minister said it should have been taken on Question No. 18.

Mr. Speaker: Order. I did not rule on any such point of order. In fact, there was no point of order arising.

Mr. Latham: Further to that point of order, Mr. Speaker. The Minister replied that he had taken the matter on my Question but that I was not here to put it. I was here to put it, I put the Question and it was answered by the Under-Secretary of State.

Mr. Speaker: That is as it should be, but it is not a matter for the Chair.

EEC (HEADS OF GOVERNMENT MEETING)

The Prime Minister (Mr. Harold Wilson): With permission, Mr. Speaker, I would like to make a statement about last week's meeting in Paris, which I regret I was not able to make last Thursday as I had hoped.
On the invitation of the President of France, the Heads of Government of the European Community met together on Monday and Tuesday, 9th and 10th December.
Our conclusions were recorded in a communiqué which has been published as a White Paper, Cmnd. 5830.
The House will see from the White Paper that a considerable part of the discussions related to worldwide issues, in particular the economic situation, trade, employment and inflation.
A high priority was given by all of us to the problems posed by the world threat of general recession, and in this connection we discussed the policies to be followed by individual countries, by the Community, and the wider world. The Federal German Chancellor dealt with the problems facing his own country on which announcements since the meeting in Paris were subsequently made by his Government in the German Parliament. Since they involve a substantial measure of reflation by a surplus country, I am sure all of us in this House will warmly welcome them.
On energy, we sought to get an improved consensus of views between the European Governments and the United States, and in particular the possibility of closer co-operation between oil-exporting and oil-importing countries. This meant that the French President in his discussions this weekend with the President of the United States would have a clearer view of the ideas and hopes of all of us on these matters.
Co-operation in the field of energy is to be pursued further at a meeting of energy Ministers in Brussels tomorrow.
On the renegotiation of the terms on which Britain entered the Community in 1971, I informed the other Heads of Government of the position of Her Majesty's Government, and the particular issues to which we attach high priority; the issues set out in our election manifesto in February and endorsed again by the people in October. I informed them also of the terms of the speech I made in London on 7th December, of which a copy has been placed in the Library of the House.
Substantial progress was made on the question of Britain's budgetary contribution to the Community and appropriate instructions given to the Community institutions, so that they can now get to work to set up as soon as possible what was called the "correcting mechanism" referred to in the communiqué. We intend to have a firm proposal and decision on this by the early spring.
Since the communiqué was published, anxiety has been expressed by hon. Members and others about two matters. The one relates to the principle of majority voting, and the Luxembourg Compromise as it has become known. I can assure the House that there is no question at all— and that this was clear in the minds of all the Heads of Government—of any member State, when important national interests are at stake, being required to set those interests aside as a result of a majority voting procedure. The communiqué makes it plain that each country will continue to be free to maintain our respective positions regarding the Luxembourg Compromise of 1966. What the meeting had in mind was the un-desirability of having too frequent a recourse to the veto, where, for example, relatively minor matters were involved.
The other issue related to the desire of most Heads of Government to make progress towards the election of the European Assembly by universal suffrage. I made it clear that the British Government could not take up any position on this question until after the renegotiations are complete and the results submitted to the British people for decision. And this was specifically reserved in the communiqué as a
Statement by the British Prime Minister.
On institutional matters generally, the House will have seen that the Prime Minister of Belgium, Monsieur Tinde-mans, has been invited to prepare a report on the institutional development of the Community, so that this can be considered by a meeting of Heads of Government a year or more from now.
The Heads of Government also reached decisions on the Regional Development Fund. The fund will be endowed with 1,300 million units of account—that is about £540 million—over the three years 1975 to 1977. Twenty-eight per cent. of the fund will be allocated to this country. Our net share of the fund could turn out to be about £60 million in all. Compared with the Government's own national expenditure on the regions of about £500 million a year the results will naturally be modest.
I was particularly concerned to press upon our colleagues the importance of national Governments, such as our own, particularly at a time of worldwide anxiety about employment, being able to act speedily with existing, and where necessary novel means of providing national aids for regional employment and regional development. On this I found full understanding among the other Heads of Government. I emphasised, of course, that such action should not offend against the Community rules of fair competition, nor amount to competitive bidding, one country against another, in order, for example, to attract some new development, say an American-owned company settling in Europe.
I have referred to institutional aspects of the Community. There is a general wish, which I share, to have important decisions taken quickly and effectively at the political level, both by Foreign and other Ministers and by Heads of

Government themselves. The meeting in Paris was in effect the first European Council. In future there will be three of these meetings a year, and more if they are required to deal with particular problems. They will be concerned both with Community matters and with important questions of policy, for example on world energy and related world finance problems, outside the Community area.
Our partners in the conference were left in no doubt that while we were not dissatisfied with the progress made on the budgetary question, there was a substantial number of other matters on which we should expect satisfaction. There is still a long way to go if Britain's essential requirements are to be met, and it is in the best interests both of this country and of Europe that speedy progress be made and the issues decided.
These questions will be taken up in meetings, early in the new year, of the Council of Ministers, and, as appropriate, at the next Heads of Government meeting to be held in the new year in Dublin under the presidency of the Irish Republic.

Mr. Heath: On behalf of the House, I welcome the Prime Minister back after his illness and express our pleasure at his recovery and thank him for the statement that he has made amplifying the communiqué which was published after the Heads of Government summit meeting.
Is the right hon. Gentleman aware that we welcome the conclusions of the summit and the fact that he put his name to everything in the communiqué with the reservation about direct elections of which he spoke?
It is now apparent that the summit in itself was an important meeting which decided to implement and carry further the decisions which were reached at the Paris summit of 1972 and the Copenhagen summit of a year ago.
Is the Prime Minister aware that the work of the Heads of Government seems to have decided itself into a number of groupings? The first is to improve the work of the Community, which we welcome, and, in particular, that when the Foreign Ministers meet in council it will be possible for them to deal with political co-operation at the same time.


That has always been a controversial matter and we welcome that it has been settled. The Commission will play its full part, common diplomatic positions will be taken up by the member States of the Community and the Assembly will be more closely allied with them.
Secondly, is the right hon. Gentleman aware of the importance of the decision that, to use the phrasing of the communiqué, the Luxembourg Agreement should be renounced? That is not quite as the Prime Minister put it. Of course, the right to preserve national interests remains to members of the Community, but I believe that it is also right that the Luxembourg Agreement, which has always been an agreement to differ, should have been renounced.
Thirdly, the group of proposals which will affect people in the Community—in particular, the study on common passport legislation, common alien legislation, and so on—will be a step forward and will bind people in the Community closer together.
Fourthly, I welcome that the Heads of Government agreed to pursue the Paris summit agreement in the hope of achieving an overall European union and to stick to the date of achieving it by 1980. The method of approach by the Belgian Prime Minister, of producing a report by the end of 1975, is a good way of handling it. I also welcome that the Prime Minister and the conference confirmed the objective of economic and monetary union and that their will has not changed.
Fifthly, I think that the House will welcome the work done at the summit dealing with inflation, the danger of unemployment, and that those States in balance of payments surplus should help those with deficits. I should think that that was an admirable example of the member States helping each other when the necessary occasion arises.
Sixthly, we welcome the establishment of the regional development fund, which was agreed in principle at the Paris summit. The amount is only half what we hoped for, but it is a beginning on which all Governments can work. Although £60 million may be a small proportion compared with what we spend on regional development, it is a large amount compared with the budgetary contribution of

this country towards the Community as a whole. Therefore, we welcome it.
Lastly, on the budget, as the communiqué specifically sets out, the Heads of Government of all member States referred to what was achieved in the accession negotiations—that if an unacceptable situation arose, the Community would have to deal with it. We welcome that they are now dealing with it in the interests of the Community as a whole, not only in the interests of Britain. I welcome the fact that the Prime Minister has accepted that situation.
To sum up, does the right hon. Gentleman agree that it was a worthwhile summit and that all the agreements point to a dynamic Community which is working with determination towards the solution of its immediate problems and a stronger European unity in the long term?

The Prime Minister: I thank the right hon. Gentleman for what he said about my return. The right hon. Gentleman is entitled to read anything that he wishes into the communiqué and the accounts of the summit, but he will recognise that it was certainly a more successful summit than the one which he attended in Paris which laid down a large number of absolutely unattainable objectives which have bedevilled the Community ever since. As for Copenhagen, they never tried to reach agreement on anything, as far as I can see, except the regional fund, on which he failed to get any agreement at all.
I agree with what the right hon. Gentleman said about political co-operation. That matter has been much pressed by my right hon. Friend the Foreign Secretary. Compared with the original formulation of the Community, my right hon. Friend sees much greater activity by Foreign Ministers acting as Foreign Ministers discussing worldwide questions, which perhaps have been somewhat neglected in the past. I welcome the right hon. Gentleman's welcome for what was decided on these particular questions.
No change in the practice regarding the Luxembourg compromise was agreed. We have agreed on the desire to avoid an over-use of the veto on matters which may not be of overall national importance. But there was no disagreement when I asked the question, "Does this mean that if there is a vital national interest it cannot be used?" They all said,


"No, of course not." They agreed that we would all want to use the veto from time to time, but that it should not be over-used. We fully accept that.
European union—I think that the right hon. Gentleman referred to this matter in the context of the Paris summit of two years ago—is a very desirable objective, but there was no agreement on what it meant at the Paris summit two years ago. At the meeting of Foreign Ministers at Schloss Gymnich at Easter, my right hon. Friend asked each of the other eight what they meant by it. There was no agreement about the meaning of that phrase. It means what individual countries or individuals want it to mean. Therefore, we were quite happy to go along with the reference to European union. I am not sure that the right hon. Gentleman has ever clearly defined what he means by European union.
I regard as more important the reference to economic and monetary union which the right hon. Gentleman glibly accepted in Paris two years ago. That, again, has never been properly defined. There was an attempt to operate the snake for a few weeks, which collapsed following the floating of sterling by right hon. Gentlemen opposite. I did not find anyone in Paris—my right hon. Friend will confirm this—who believed that there was the remotest possibility of economic and monetary union by 1980, which the right hon. Gentleman is now commending to the House. No progress whatsoever has been made towards it. If the right hon. Gentleman knows what it means and has views about it, the House will be passionately anxious to hear what he has in mind-perhaps in the debate that we are to have on Thursday. The view expressed by some of our leading colleagues was that it could not become a reality in the near future.
Indeed, when the right hon. Gentleman just now, I thought rightly, praised the action taken by particular countries of following different economic policies—for example, German reflation when others are faced with deflation—that was a total denial of the concept of immediate or early economic and monetary union. A simple union, as was strongly pointed out by our colleagues, would mean one central bank, one central currency and one central Finance Minister. It would also mean

that every country would have to pursue exactly the same policy with that single currency when the need at present is for Germany to reflate and for others to draw in their horns considerably. Therefore that is an illusion.
We agreed to the communiqué about economic and monetary union. In the same way, I am happy to tell the right hon. Gentleman that just as he agreed, when he was Head of Government, we in Government have agreed to the long-term ideal of general and complete disarmament. I am all for it. But I do not expect it by 1980. That was the phrase that I used last week in respect of economic and monetary union. We accept it as a long-term objective, but it was not accepted by anyone as an objective by 1980, any more than total disarmament was, and that was the phrase that I used.
Regarding the regional fund—[HON. MEMBERS : "Too long."] I have been asked seven questions, and I propose to give seven answers. Regarding the regional fund, the right hon. Gentleman said that it was only half what he was asking for. In fact, in Copenhagen he did not get anything, so he should welcome the fact that we have got half. The right hon. Gentleman got a form of words. We have got cash, which is rather different.
What is much more important, as I hope the right hon. Gentleman will agree, is that I emphasised the need for reasonable freedom, especially in the present world situation, to follow national policies of regional help without it being questioned by fussy interference from the Commission or anybody else. I wish that he had made that plea for this country. I wish that he had laid claim to that when he negotiated the terms of entry in 1971.
Finally—[HON. MEMBERS: "Too long."]. I am sorry that hon. Members are so frivolous about these important European questions. We were creating a precedent by sticking up for national British interests there.
With regard to the budget question, the right hon. Gentleman was right in what he said. But what he did was to turn the form of words agreed to in 1972 into procedures and into an instruction to the institutions of the Community —namely, the Council and the Commission—to create a self-corrective mechanism on the basis for which we asked.
The right hon. Gentleman was right, I think, in another remark that he made here. The position is that in the years immediately ahead it is clear—as it was in his day; and that was why he asked for this saving clause—that the cost of entry into the Common Market will inevitably be a net disbalance for Britain. I think that was recognised by the right hon. Gentleman's Government. That was why he asked for this waiver. But when we come into the 1980s and when there is North Sea oil and the rest of it, if the terms of renegotiation are such that we are still in the Common Market, we would feel it right that we should make a bigger contribution then, following a smaller contribution in the late 1970s.

Mr. Jay: As what my right hon. Friend has said today about the Luxembourg Agreement is not what is contained in the communiqué and as it is rather important to be clear on this issue, will he now say clearly whether or not we have renounced the Luxembourg Agreement?

The Prime Minister: The position is that we said we would renounce the practice, which consists of making agreements on all questions—all questions, major and minor—with the unanimous consent of the member States, whatever their respective positions may be regarding the conclusion reached in Luxembourg on 28th January 1966. All members of the meeting said that where vital national questions are involved we have the right to indicate disagreement, and then agreements will not follow. That is the position we have taken up to now. It is the position we are taking following the meeting last week.

Mr. Russell Johnston: Is the Prime Minister aware that many people will regard with a certain degree of incredulity his reference to the endorsement of his manifesto by the people when fewer than one-third of the people actually voted for his party in a constructive way?
Secondly, is the right hon. Gentleman aware that it is a matter of great regret, on all sides of the House, that Britain should specifically—the Prime Minister referred to the fact that it was specifically —be the means of delaying the democratisation of the Community? How does the right hon. Gentleman square the

speeding up of political decision, to which he referred, with a refusal to improve the democratisation of the Community and a rejection of any movement towards supra-nationalism in regard to the Luxembourg Agreement?
Finally, the Prime Minister referred in approbatory terms to the Federal Chancellor. Will he take this opportunity completely to reject the remarks of his hon. Friend the Member for Blyth (Mr. Ryman), who referred to the Federal Chancellor as a "patronising Hun"?

The Prime Minister: With regard to the third question, I deplore that remark. I very much regret anything of that kind being said about a distinguished visitor to this country. I do not like phrases which even hint at racialism.
With regard to the question about what the hon. Gentleman calls "the democratisation of the Community", and his reference to the communiqé delaying any democratisation of the Community, if by that the hon. Gentleman means direct elections, these are matters which I think can all be considered if and when satisfactory terms arise from our renegotiation and the British people accept them.

Mr. Bottomley: Will my right hon. Friend say whether the negotiations which he is at present conducting are within the terms laid down in the Labour Party manifesto as issued at the last General Election?

The Prime Minister: Yes, Sir, entirely, they are, indeed, entirely consistent with what we asked for in 1966 and 1967. With regard to my right hon. Friend's question, I dealt with these matters in some detail in a speech in London just before the meeting in Paris and, as I have said, a copy of that has been placed in the Library. There are seven points on which we are insisting. We have made good progress on the budgetary point. One or two points may not now appear to be quite so difficult—for example, value added tax, on which harmonisation seems to be almost a dirty word in the Community. I have referred to EMU in this connection as totally unrealistic. But, as far as I am concerned, if we get the terms set out in the manifesto, approved by the British people in two elections, I believe that we shall have got what we set out to get. If we do not—as I


said in the same speech—we shall have to make our own arrangements.

Mr. Walters: As the Prime Minister appears to be well satisfied with the progress at the summit, would he not consider it helpful at this stage if he made a clear statement of how he and his Cabinet would stand if he completes the renegotiation successfully?

The Prime Minister: I have just referred to that. We have made some progress on the budgetary question, which I very much welcome. I have referred to the fact that one or two of the other points to which we have attached great importance look to some extent like solving themselves because of pressure within the Community itself. I have just referred to some of them. But on other matters —for example, access to food, the question of the unfairness of the Commission in industrial matters, such as steel, as we have had over the last week, and the question of national aids for regional development—there are still a number of problems to be solved. We must see how we go on them. We have made progress last week. There is still a long way to go.

Mr. Roy Hughes: Is my right hon. Friend aware that he is giving the impression of blowing up minor concessions into major triumphs and that ordinary people will not be fooled by this, even though he might temporarily have the support of The Times, the BBC and almost every other organ of the media, which have broadcast all manner of distortion and censorship on this issue to try to prevent the true facts being presented to the British people?

The Prime Minister: If my hon. Friend has been fooled by the Tory Press acclamation of what happened last week, there was no ministerial responsibility for my hon. Friend being fooled in that way. But were he listening to what I said a few minutes ago, he would have noted that I said that there were seven major points for renegotiation in our manifesto, which has been the policy of our party for a considerable time, and that I asserted that there was limited progress on one of the seven. I hope that my hon. Friend will deduce from that that there is a long way to go on the others.

Mr. Powell: On the subject of a Community budget, has it been made clear to the other member States of the Community that both the taxes which provide the Community's own resources and the purposes on which they are mostly to be spent have been declared to be unacceptable to the British Government and that, therefore, in those respects there will have to be fundamental alterations before the negotiations can, in that respect, be regarded as successful?

The Prime Minister: It was the fundamental changes we were seeking in the discussions on the budget. What I have said to our colleagues in the Community —as indeed, has my right hon. Friend the Foreign Secretary on many more occasions—is that the particular way in which the own resources system has been worked out—and was so tamely accepted by right hon. Gentlemen opposite three years ago—ignores the fact that Britain is a very considerable food-importing nation, probably the biggest food-importing nation in the world. Therefore, a budget based right across the board on levies and duties on food imported by a country which has to import a lot of its food, compared with many European countries which are self-sufficient and even food exporters, necessarily involves great unfairness. At each point we were pressing, and in particular for fundamental changes in the budget.

Mr. Mackintosh: I understand my right hon. Friend's policy about the whole pattern of renegotiation, but does he agree that the most difficult single problem has been solved and that the sooner renegotiation is over the better, because then the Community can turn together to face major problems of recession, energy shortage, and reflation, which we can solve only in common and of which the benefits to people in this country will be greater than any other?

The Prime Minister: Both in my speech to the London mayors and to the conference I said that in the interests of all of us—of Britain and also of the other members of the Community—it is vitally important that we make the maximum progress to get these matters settled so that we can put the issue to the British people and everyone here and in other parts of Europe can know where he is.


That I believe to be urgent, and both my right hon. Friend and I impressed that upon our colleagues. That was why we had some anxiety on the budget point. We should have liked to see even more rapid progress.
My hon. Friend has listed various problems, including the dangers of recession, which were greatly stressed by the Chancellor of the Federal Republic of Germany.
There are also questions of energy problems, the question of inflation, the question of a healthy balance of payments, recycling, and the rest. We were not inhibited in any way from discussing these questions fully, both in the larger meetings which included the Heads of Government and the Foreign Ministers, and also in the more limited meetings of the Heads of Government, where we pursued these matters very frankly. This was with a particular view to the fact that the President of France, who was our chairman, is to meet the President of the United States very soon, and we wanted to give him freedom to discuss matters freely, and also because others of us will be having meetings with the President of the United States and in the Soviet Union as well as with other Heads of Government shortly.

Sir Bernard Braine: The communiquà does not appear to make any reference to one of the gravest problems facing the Community in its relations with the outside world, namely, the continuing world food crisis and the absolute fact that 30 million to 40 million people will die of starvation somewhere in the world in the next 12 months. Was the subject discussed?

The Prime Minister: Yes. I pay tribute to the hon. Member, who has been active with other hon. Members throughout the period he has been in the House—indeed I have often joined forces with the hon. Gentleman on this—in drawing attention to the vital importance of this subject. The problem was discussed. The Council of Ministers has been giving attention to this matter following the World Food Conference. The hon. Gentleman will be pleased to hear that one of the seven items I referred to on which considerable progress was made —it is referred to in the document I

have placed in the Library—was the not unsuccessful negotiations in Jamaica of the Ministers in relation to making benefits available to certain developing countries—a wide range of Caribbean, African and Pacific countries.
Here I pay tribute to my right hon. Friend the Minister of Overseas Development, who played a significant part in those negotiations. I know that the hon. Member will welcome the progress which has been made. I should like to see even more progress made—for example, in relation to the Indian sub-continent. It is certainly the case that it is no longer true, as a result of progress made in recent months, that it is only the old French and Belgian colonies that are being favourably considered.

Mr. Atkinson: Has my right hon. Friend any misgivings about our seemingly total acceptance of the Treaty of Accession? Has he any regrets about having said that he personally will advise the British people to accept the conclusion of the renegotiation outcome in advance of any decision taken by the Labour Party conference?

The Prime Minister: When I attacked in the House the Treaty of Accession from my position on the Opposition benches I was referring to the terms negotiated in 1971. I thought that they were deplorable. It is quite clear that the Leader of the Opposition was a soft touch and was so regarded by our colleagues in Europe. We are trying to renegotiate those terms. It is quite clear that they can be so renegotiated within the terms of the treaty. That was said in early April by my right hon. Friend.
That does not mean that we must lie down under the appalling surrender on sugar. The Leader of the Opposition can turn and laugh at my reference to sugar. He knows that the problems in relation to sugar that the British housewife is facing are due entirely to the sell out on the sugar terms negotiated by his Government. This point is being made this week by the Commonwealth sugar producers. They were given no guarantees. We made that point very strongly outside the House when the terms were negotiated.
The terms of the Treaty of Accession are to be varied, not by treaty changes, if we are successful here, but by changing


the terms on which the right hon. Gentleman negotiated our entry into the Market three years ago. We are making some progress—not fast enough, but considering what the right hon. Gentleman achieved we are not doing badly up to now.
On the second part of my hon. Friend's question, what I said was entirely in accordance with the Labour Party manifesto. I fought two elections on the manifesto. I had a lot to do with the production of the manifesto over a period of time. I stand by the manifesto.

Mr. Heath: Hear, hear.

The Prime Minister: I am glad to hear the Leader of the Opposition say "Hear, hear". I hope that he means that he stands by the manifesto. He has spent the last three years opposing everything that we said in the manifesto. That is why he is on the Opposition Front Bench, not on the Treasury Front Bench.
I stand by the manifesto. I stand by the requirements we have set out. We are now seeking to attain those requirements, and if we achieve them, it stands to reason that I can commend them to the people. If we do not, we must, as I said in the statement, make other arrangements, because I could not commend them to the people. Every Labour Member of Parliament was elected on the manifesto. All our constituents will expect us to honour the manifesto. If the Leader of the Opposition had a manifesto half like it, he might not be in the trouble he is in now.

Mr. Thorpe: Is the Prime Minister aware that we all welcome his return to health, both physical and European, and that we recognise all his reservations, cautions, conditions, apprehensions, and strictures upon the inadequacy of the Opposition in their negotiations, but that many of us think that things are going very well and that we congratulate him and that we hope things will continue to go well.

The Prime Minister: I thank the right hon. Member for Devon, North (Mr. Thorpe) for his very kind words concerning my temporary indisposition. As he said, I have returned from European sickness. I am not sure of the cause of the disability. I was better once I

returned to some good, plain English food —we all have our tastes, do we not?— and beer.
The right hon. Gentleman referred to my remarks about the Opposition. Although I did not take much time to deal with the Liberal Party, what I had to say in my strictures on the official Opposition must apply equally, if not a fortiori, to what the Liberal Party has been saying.

Mr. Marten: The Prime Minister said in answer to my right hon. Friend's supplementary question that there was no agreement on what political union means. He then said that it is a desirable objective. How can there be a desirable objective when there is no agreement on political union?
Second, will the right hon. Gentleman expedite a study of what is meant by political union before we have a referendum? That is one matter about which the people will want to know. The people will want to know what is entailed by political union. If the right hon. Gentleman cannot do that, will he, before the referendum, move the repeal of Section 2 of the European Communities Act?

The Prime Minister: Many of us were concerned—even had we thought that the terms were right—about the way in which the Act was drafted in terms of its effects on the rights of Parliament. Political unity has been demanded by many people but I have never yet heard a clear definition or an agreed definition of what it means.
I doubt whether the right hon. Leader of the Opposition could tell us what he means by political unity, but he has said it is something that he desires to see. It is obviously very desirable in principle, but no one has begun to say what they mean by the term. Perhaps the Leader of the Opposition will tell us this week what he means by political unity. I doubt whether he knows. For example, the unity of the Conservative Party is desirable, but I have no idea if everyone would define its unity in the same way or define how its unity will be achieved. [HON. MEMBERS: "What about the Labour Party?"] We are doing quite nicely thank you in that respect.
As it was clear that the nine countries had no idea what European union meant


in definitive terms, we all agreed with enthusiasm that M. Tindemans, who carries high respect within the Community from all countries, whatever their points of view, should spend next year considering all aspects of the institutions, including political unity. At the end of that time—that is if we are still in the Community and depending on the terms and so on—we shall be prepared to consider what he recommends. Her Majesty's Government will have absolute freedom in saying what type of European union we are prepared to recommend to the House. So far there are no proposals on the tapis at all.

Mr. Dalyell: In the discussions on European energy policy, was much said about North Sea oil?

The Prime Minister: Yes. I have already said that I referred to it in the context of the budget. There was relatively little discussion about specific European energy policy because all of us recognised that the big energy challenge, including recycling, is of worldwide dimensions. It was that which we spent most of our time discussing. We did not try to work out a specific European energy policy, but, as I have told the House and as the communiqué says, the energy Ministers of the nine countries will be meeting in Brussels tomorrow.

Mr. Heath: Almost without exception among my right hon. and hon. Friends and from many parts of the Labour benches there has been a welcome for the communiqué to which the Prime Minister has put his name and for the statement which he has made today. I ask the right hon. Gentleman not to allow himself to undermine his own position as he has been doing in the answers which he has given to many supplementary questions.
Perhaps the right hon. Gentleman will take the opportunity of rereading the communiqué and his statement and seeing exactly what it is to which he has agreed. It is very important. We welcome the fact that he has signed.
I point out to him that the reply that he gave on own resources reaffirms that the system of own resources represents one of the fundamental elements of the economic integration of the Community and that the rearrangement which is being

made will be within the framework of that system. That is perfectly right. We arranged for that in the accession negotiations. I heard for the first time that the Prime Minister thinks that in the 1980s we might be paying a greater proportion than that set out in the Treaty of Accession. That shows that we negotiated an arrangement that has sufficient flexibility to handle both the current economic problems and the better position we hope to have in the 1980s.
On the question of EMU, does the Prime Minister mean that he has reaffirmed that the will of the Community has not weakened and that its objective has not changed since the Paris con ference? There is not very much room for criticism of us on that point because the right hon. Gentleman has reaffirmed everything we set down.
On the regional development fund I welcome the fact that the right hon. Gentleman has obtained £60 million. That will do a great deal to redress the balance of the budget. The right hon. Gentle man said that we did not provide safeguards but he then said that national aids will be within the rules of fair competition and will not amount to competitive bidding. Both those decisions are absolutely right and we made both when we were in Government. Will he recognise that that is what he has agreed and will he abandon this sham of renegotiation? He has said that he accepts the Treaty of Accession. Let him say honestly to the country that what he is doing is using the normal machinery of the Community to make the necessary adjustments as we go along.

The Prime Minister: We are using such machinery as is available to us to repair the damage done by the right hon. Gentleman in his negotiations. I have already mentioned sugar. But for the sell out on sugar, on which we warned the House and the then Government, we would not be facing a desperate and costly sugar situation today.
On the main point of the right hon. Gentleman's intervention—I was not sure whether it was a question—nothing I have said in the House today in relation to the communiqué is other than what I said, as my right hon. Friend will confirm, in the negotiations with our colleagues last Monday and Tuesday. On every


point on which I have reserved our position today I reserved it specifically and in terms last week.
I have answered the point about European monetary union. The right hon. Gentleman signed on EMU a blank cheque. He did not have the faintest idea what it meant. He must have realised that it was unattainable or, if attainable, utterly damaging to this country. We made EMU a long-term objective. There is not a hope in hell—I mean in the Common Market—as the other Heads of Government have made clear, of EMU taking place in the near future. Everything that is in the communiqué which bears on the points which we are renegotiating was specifically reserved by my reading out the seven items on which we require satisfaction on renegotiation. The right hon. Gentleman is wrong. Nevertheless, I do not mind if he chooses to take satisfaction from this point. We are working hard to undo the damage which he has implanted on the country.

FIRES (LONDON AND NOTTINGHAM)

The Secretary of State for the Home Department (Mr. Roy Jenkins): With permission, Mr. Speaker, I wish to make a statement about two tragic fires that occurred in the last few days.
The first occurred at the Grand Metropolitan Hotels staff hostel at 9–17 Clifton Gardens, London, W.9, shortly after 3 a.m. on Friday 13th December. The premises comprise five interlinked terrace houses consisting of a basement and four storeys, with an attic. The fire developed rapidly in the upper part of the building, and although 19 people were rescued by emergency means, I very much regret to say that seven persons, including one fireman, were killed. Three other firemen were injured.
The premises fall within the scope of the Fire Precautions (Hotels and Boarding Houses) Order 1972. Application had been made for a fire certificate, and the premises had been inspected and the necessary work specified, but it had not yet been carried out.
The London Fire Brigade is conducting a full inquiry into the cause of the fire, and I will decide in the light of the out-

come of that inquiry whether there is a need for further action on my part.
The other fire occurred at Fairfield, an old people's home, at Edwalton, Nottinghamshire, shortly before 2 o'clock in the morning of Sunday 15th December. Although two fire appliances arrived within six minutes of receipt of the fire call, the fire spread rapidly, and resulted in the deaths of 18 people.
These premises consisted of a single-storey, purpose-built building, comprising a central core from which radiated a number of self-contained units each of eight or nine bedrooms. The premises were equipped with smoke-stop doors, fire alarms, and fire extinguishers and means of escape in accordance with the recommendation of the fire authority.
The cause of the fire and its place of origin are not yet known, but this is being investigated by forensic science experts. My right hon. Friend the Secretary of State for Social Services has called for a full report from the Nottinghamshire County Council on the circumstances.
I should like to take this opportunity of expressing, I am sure on behalf of the whole House, my deep sympathy with the bereaved and injured, together with my appreciation of the gallant work of the fire brigades concerned.

Mr. Arthur Latham: I thank my right hon. Friend for his statement about the dreadful tragedies that have taken place within the past three days. I should certainly like to be associated with his expressions of condolence to the bereaved and sympathy with the injured.
I should especially like to pay tribute to the fireman, Mr. Hamish Pettit, who lost his life in the Paddington fire on Friday. He was one of a group of brave men who knowingly and valiantly risk their lives daily to save others, and there is no greater community service and courage. I should be grateful if my right hon. Friend could assure me that adequate provision will be made for this man's young widow and baby son.
Does my right hon. Friend agree with me that it is alarmingly significant that only 18 months ago the Worsley hotel was in full use as a hotel, some two years after the passing of the 1971 Act? Does he confirm that in London there are still four out of five hotels not complying with


the safety regulations? Could he establish a study into that general problem to see what may be done to speed up the process, perhaps with particular emphasis on the financial difficulties that arise and possibly some bridging financial assistance if that is appropriate?
Lastly, could my right hon. Friend seriously consider whether hotel buildings used as staff hostels represent by the very nature of that use an even greater hazard than a hotel building used for normal hotel purposes? My right hon. Friend will recall the Islington incident of not long ago. Could he look into a tightening of the standards applying to hostel accommodation of this kind?

Mr. Jenkins: I am grateful to my hon. Friend for the moving way in which he has expressed his tribute to the fireman who lost his life, and not only to that fireman, but to all those who played, as they so often play, a gallant part. I will certainly look into the question of proper provision for the young widow and the baby son of the dead man.
There is a major problem about hotels complying with the safety regulations. We are making progress. In the GLC area, out of 1,489 applications received 1,475 had been surveyed to a recent date. But only a relatively small number of fire certificates have been issued, and, as was the case with these premises, there is a great deal of work to be done, although it is in hand.
But it is no good the House pretending that we can solve the problem overnight. The responsibility is finally that of the local authority, in London and elsewhere, to operate under the 1971 Act and the regulations of 1972, and certainly we shall give them every encouragement to do so. However, there is a major problem.
There is no doubt that these premises were clearly within the scope of the Hotels and Boarding Houses Order 1972. An application for a certificate in respect of them had been made. I should like to look into whether there is some special hazard associated with their being used as a hostel rather than as a hotel. I am not sure whether there is any validity in my hon. Friend's observation on that matter, but I should certainly like to look into it. As a result of the Islington

tragedy we are issuing new guidance to local authorities and they are to report to us at an early date. We will keep these points in mind for any further guidance that we may issue.

Mr. Kenneth Clarke: Is the Home Secretary aware that my constituents and the relatives of those who died in the Fairfield fire will be grateful for his expressions of sympathy? With many hon. Members on both sides of the House, I should like to be associated with what he has said.
Is the right hon. Gentleman aware that the old people's home in question was modern, very well appointed and well administered, and that those concerned have nothing but praise for the action of the staff on duty and the emergency services that responded to the fire call? That shows that there is full confidence locally in Nottinghamshire in the local inquiries into the cause of the accident.
Nevertheless, the CLASP system of building, which was pioneered in Nottinghamshire, is now used widely in many areas for this kind of building. There is a local expectation that the Home Secretary will order a wider public inquiry so that other users of this system may be reassured, and so that we may all be reassured, that the fire precautions standards of this kind of building are brought up to date. Does the right hon. Gentleman confirm that he has not ruled out the possibility of a full public inquiry into the cause of the fire?
Finally, when his right hon. Friend the Secretary of State for Social Services, whom I see in her place, calls for a report on this tragedy, will he ask her to bear in mind the possibility that this kind of tragedy is due in no way to lack of fire precautions or the proper provision of facilities, but to the fact that a very high proportion of the residents of these oldish people's homes are either bed-ridden, or very infirm and immobile, so that they cannot take any advantage of the precautions? With the wisdom of hindsight, if that is to be applied, could the right hon. Lady perhaps consider whether local authorities should be advised to keep down the proportion of totally immobile residents in the larger old people's homes, or to reconsider staffing arrangements, or the manner of


exit, when they have a high proportion of totally immobile residents housed in one complex?

Mr. Jenkins: Again I am grateful for what has been said. I am grateful, too, for the hon. Gentleman's appreciation of the work of the emergency services and of the way in which this tragic home, as it turned out, was run.
It is, of course, the case that this was not an old building. It was built in 1959–60. The CLASP method of building is not a technical description, but refers to building by a consortium of local authorities, and it originated largely in Nottinghamshire. It has been used for a variety of purposes—old people's homes, schools and other buildings of that sort. I will consider urgently whether there is any matter falling within my responsibility and the Government as a whole will consider whether there is any problem that arises within Government responsibility.
But I do not think that it would be right at this stage for the House and the country to assume that these buildings are unsafe. Fire tragedies of this sort, alas, occur in a wide variety of different types of building. The most rigorous investigation is necessary, and will take place, but it would not be right to assume, immediately and automatically, that the fire was something to do with the type of building, although we will consider that.
I have held open the decision about an inquiry, and I will seriously consider what has been said. My powers to order an inquiry in relation to a fire, or efficient fire prevention, or fire precautions activities, within a local authority area are limited by the Act of 1947. Indeed. I think that there has been only one inquiry under that Act. My power relates essentially to the efficient working of the fire brigade in a local authority area.
My right hon. Friend will consider whether there are other aspects of the matter that call for a public inquiry. I should not wish to prejudge this question in any way. It may be a joint inquiry, between us; it may be one primarily under her authority; it may be one primarily under my authority; it may not be called for. However, we will look at this most urgently. My right hon. Friend has just told me, and I can tell the House, that she is going to Notting-

hamshire tomorrow to see the position and to receive reports on the spot

Sir Keith Joseph: I should like to associate the Opposition with words of sympathy to the victims and of tribute to the firemen.
Would the right hon. Gentleman consider initiating a departmental review into the workings of the Fire Precautions Act 1971? We understand the scale of the task that has to be done to protect against fire in so many buildings, but does he recognise that there may be need to consider the delays and difficulties involved in the three different stages of inspection, financing and actual execution of the work? Will he therefore consider a departmental review?
Secondly, as to the fire at Fairfield, will the right hon. Gentleman accept that, in the light of the fact that this was a purpose-built home, there were a large number of deaths? There will inevitably be widespread concern and perhaps lessons for widespread application, and his right hon. Friend the Secretary of State for Social Services will be asked why she has not decided to hold a public inquiry. I well remember the tragedy at Coldharbour, as I am sure does the right hon. Lady. At least the inquiry which has been ordered should be published. I hope the Home Secretary will convey to his right hon. Friend the view that a public inquiry might be the best solution in this case.

Mr. Jenkins: If I may deal with the latter part of the right hon. Gentleman's question first, I do not understand that my right hon. Friend has begun to decide that a public inquiry is not called for. One of the problems involved in the Private Notice Question procedure —this is a statement for technical reasons—is that it is right and desirable that the House should be informed and should be able to express its views when national tragedies take place. However, it must also be recognised that the Ministers concerned inevitably have to respond at very short notice, and it is undesirable that by this procedure my right hon. Friend, or I, or any other Minister should be forced into a snap decision, one way or the other, which would be premature. I think it is right that my


right hon. Friend should see the position, as she will tomorrow morning, on the spot, and then make up her mind, perhaps in conjunction with me, although probably it will primarily be a matter for her as to whether a public inquiry is justified.
I assure the House that there is no question of either my right hon. Friend or I having begun to close our minds against a public inquiry at this stage.
The earlier part of the right hon. Gentleman's question dealt with whether I should hold a departmental review into the working of the 1971 Act. I shall certainly consider any suggestion of that sort which is put to me. The right hon. Gentleman rightly outlines the three phases of inspection, of financing, and of execution. The Act does not make the fire hazard greater, although it makes it more obvious, which is a step forward. However, by no Act or order or expression of this House can we change overnight the position with regard to fire precautions in a vast range of buildings in London and throughout the rest of the country.
As regards financing, there is an intention on the part of my right hon. Friend the Chancellor of the Exchequer to table an amendment to the Finance Bill, which will make a limited improvement—I hope a worthwhile one—with regard to the financing aspect of this matter.
I will press on with the other aspects. This is a local authority responsibility primarily, but in so far as I can give guidance and encouragement with the effective implementation of the Act I shall do so, and, without any commitment, I would be willing to consider a review— whether in the exact form suggested or not—if I thought that it would help.

Mr. Beith: I should like to associate my right hon. and hon, Friends with the expressions of sympathy and appreciation already made.
May I ask the Home Secretary whether he knows how deep is the concern that such a tragic fire should have occurred in a building which has passed fairly exacting fire safety standards? Does he recognise that many of us are concerned

about old people's homes in converted buildings of more than one storey which are presenting severe financial difficulties to local authorities trying to meet fire standards and which will present difficulties if a fire takes place? Does he not recognise that it would take time to implement this Act and to improve buildings up to the standards which we now have, and that there is a case for temporary measures such as additional fire drills, higher rates of night staffing and possibly lower rates of occupation in institutions which have not yet been brought up to the fire standards?

Mr. Jenkins: Clearly, of the three points mentioned, two—the staffing and the lower rates of occupation—would be matters for my right hon. Friend and not for me.
With regard to fire drills, and without in any way wishing to encourage any sense of panic, I think it would be useful if those responsible for running such homes, which exist I think in 8,000 buildings, within a wide variety of old and new premises, some purpose built and some converted, were to seek guidance from the chief fire officer or from the local fire service at a high level as to the conditions there and how best they can deal in a cautionary, and not a panicmongering, way with the problem which has been highlighted by this tragic occurrence in Nottinghamshire.

Several Hon. Members rose—

Mr. Speaker: Other questions must be put down by hon. Members in the usual way. There are more than 40 right hon. and hon. Members who wish to speak in the next debate.

BUSINESS OF THE HOUSE

Ordered,
That at this day's Sitting, Mr. Speaker shall put forthwith any Question necessary to dispose of proceedings on the Motion relating to the Army, Air Force and Naval Discipline Acts (Continuation) Order 1974 at half-past Eleven o'clock or so soon as proceedings on the Motion relating to the Defence Review have been disposed of, whichever is the later. —[Mr. John Ellis.]

DEFENCE

Mr. Speaker: Before I call the Secretary of State for Defence I ought to inform the House that I have selected the Opposition amendment.

Mr. Stanley Newens: On a point of order, Mr. Speaker. I note that you have not selected the amendment standing in my name and the names of a number of my hon. Friends, which means that many of us will be deprived of the opportunity of expressing a point of view about which many of us feel very deeply. I am aware of the precedents which apply in cases of this sort, but I wonder whether it would be possible for further consideration to be given to this matter, since it prevents the debate from accurately reflecting points of view held by many hon. Members and which are widely held outside the House.

Mr. A. J. Beith: Further to and in support of that point of order, would you not, Mr. Speaker, agree that it would be helpful if the Procedure Committee were quickly to report on this matter, which has been referred to it, for the assistance of minority parties and groups within the parties?

Mr. Speaker: That is certainly the case. With regard to today's debate, I am afraid my selection must stand. The hon. Member for Harlow (Mr. Newens) said that certain hon. Members ought to have the opportunity to express their opinions. If the hon. Member persists, he may very easily catch my eye and be able to make a speech during the debate.

4.38 p.m.

The Secretary of State for Defence (Mr. Roy Mason): I beg to move,
That this House takes note of the Secretary of State for Defence's Statement on Tuesday 3rd December 1974.
It might be for the convenience of the House if we included in the debate the Army, Air Force and Naval Discipline Acts (Continuation) Order 1974.
On 3rd December I made a statement to the House about the progress made so far in the defence review. Today I should like to explain more fully some of the background to the review, which has been, I believe, the most comprehensive examination of our defence commitments

and the resources available to meet them since the post-1945 rundown.
In the broad historical perspective, it will, I think, be seen as part of the process through which Britain adapted itself politically, psychologically and economically to a new rôle as an influential middle-rank Power without post-Imperial pretensions.
As part of that process, the Labour Government, in 1968, took important decisions on our world-wide defence commitments, designed to achieve a complete withdrawal of our forces from east of Suez—with the exception of Hong Kong —by the end of 1971.
In his supplementary statement on defence policy in 1970, the then Secretary of State for Defence, Lord Carrington, reversed or modified a number of those decisions. Therefore, when I came into office in March of this year I inherited a programme which included forces stationed in a number of places throughout the world on a scale which was no longer in keeping with Britain's economic and political position.
I inherited a defence budget of £3,667 million for 1974–75, representing about 5½ per cent. of our gross national product. Morever, the long-term costings for 1974, projected forward for 10 years, showed that to maintain and progressively reequip forces on the scale then planned would cost at 1974 public expenditure survey prices £4,300 million a year, or about 6 per cent. of the GNP, by 1978–79, and about £4,500 million a year, or over 5½ per cent. of the GNP, by 1983–84. In other words, in terms of the proportion it took of our national wealth, the burden of the defence expenditure on the British economy throughout the 10 years would have been half as much again as that borne by West Germany and a third greater than that borne by France, both of whose economies are richer than ours and are expected to grow significantly faster than our own. It was clear to the Government that the economic situation of the country and the burden of defence expenditure at the level of the plans costed in February 1974 were incompatible, and, from the succession of short-term cuts made by the previous Conservative administration in their last year of office, it seemed that the penny, or the pounds, had begun to drop with them as well.
On 17th December last year the then Chancellor of the Exchequer announced a £178 million reduction in defence expenditure, and this was on top of cuts totalling £72 million imposed in the previous May and October, adding up to a total of £250 million, or £291 million at 1974 prices. But, unlike the policy of the then Government, I was determined that the process of adjustment to the realities of our economic, strategic and political position should not be by a series of arbitrary cuts. Above all, I wanted to make sure that our defence priorities were seen to make sense and that our forces were seen to be tailored to what Parliament, the British people and our allies accept as essential to our security and that of the North Atlantic alliance.
Even while the review has been under way, the international economic environment in which Britain must survive and prosper has become even more unfavourable. Over the past 12 months there have been further increases in the price of oil charged by the producing States, and for this reason, among others, the terms of trade are now about 11 per cent. worse than they were 12 months ago.
While it was essential that the review should take account of this economic reality, I also had throughout in the forefront of my mind the other reality of the continuing threat to Western security posed by the massive and growing military power of the Warsaw Pact.

Mr. Frank Allaun: Before my right hon. Friend leaves the economic side, will he now admit that, far from there being a real reduction in spending, his review will mean a considerable increase in both real and cash terms compared with the estimate which he has just mentioned for this year of £3,667 million? Did he not admit last week in a Written Reply to a member of the Opposition that next year in real terms the spending will go up to £3,700 million and in the following year to £3,800 million, and that it will remain at that figure for at least seven years? Is that an increase or a reduction?

Mr. Mason: My hon. Friend has a point, which I must recognise. I have always said—I said it in my statement.

I have reiterated it publicly since, and I have repeated it in answer to Questions in this House—that we have cut back defence expenditure on the proposals and plans which we inherited and that in 1975–76 the increase in defence expenditure was to rise to £4,000 million. We have cut that back to £3,700 million, effecting a saving of £300 million, on the plans and proposals which we inherited. Yes, there is bound to be a small increase in the real expenditure on defence, and I acknowledge that, but it is on the proposals which we inherited that we are effecting the savings.
I was explaining that there are two sides to the coin. One is the economic realities of the situation. The other is the threat posed to which we have to have a credible defence posture.
I must stress that the Western alliance of which we are a member is a defensive alliance. Its aim throughout has been to preserve stability and peace by deploying military forces in sufficient strength to deter aggression on whatever scale and in whatever form it may occur. If we were to reduce our contributions too far, and this example were followed by other countries, there would be a serious risk that the credibility of NATO strategy would be destroyed. We would risk undermining the cohesion of the alliance as a whole. From the outset, therefore, I have been at pains to emphasise that the review should be—and it has been, I believe— conducted calmly and rationally.
For example, we did not attempt to make easy economies through arbitrary raids on the equipment Votes, or through across-the-board adjustments in procurement schedules to produce short-term savings which would make little military sense. Instead, we started by reviewing strategic and military priorities among our defence commitments, and against these priorities we examined alternatives with an open mind. In the process we analysed every aspect of our defence policy. This is why our review has taken so long.
It was clear from the outset that our search for economies would have to extend beyond our military deployments outside the NATO area. It was equally clear that we could not abandon our obligations towards our remaining dependent territories, nor withdraw


entirely and at short notice from our commitments to other non-NATO allies and partners. But we believe that the commitments that we propose to retain to our allies and partners outside NATO are the maximum that we can afford given the high priority that we attach to our NATO contribution.
As for our non-NATO allies and partners, consultations are still in progress, and I cannot at this stage give more information. It is my hope that my hon. Friend the Minister of State will cover the reasoning behind our proposals on our non-NATO withdrawals, in view of the fact that he has been especially involved in this stage of the consultation process. But we believe that the proposed reductions in our forces will not threaten the security of any of these allies and partners.

Sir Anthony Royle: I have just returned from talks at the highest level in both Malaysia and Singapore, where there is some resignation to the Labour Government's attitude and the decision which they have taken. However, there is total bewilderment about the decision which the right hon. Gentleman has apparently taken to withdraw the Gurkha battalion from Brunei. This decision will save the taxpayer no money at all, especially as the battalion is administered from Hong Kong. As a result of this withdrawal, the stability of Eastern Malaysia may be put at risk, plus the fall-out on commercial interests in the whole area. Can the right hon. Gentleman explain a little more the cuts in this non-NATO area?

Mr. Mason: I cannot give much more detail than hitherto. But the hon. Gentleman will recognise that I feel that there was a recognition by the rive-Power defence arrangement countries that once a Labour Government were returned with a working majority they were likely to carry out the 1968 commitment, and they were resigned to that fact.
As regards Brunei, we propose to cut back the strength of our Gurkha forces. The Gurkhas are stationed in Brunei at no cost to us. We have made the proposal that we would like to withdraw them from Brunei and concentrate Gurkha forces in Hong Kong. This is still subject to consultation with the Sultan

of Brunei, but that is the proposal before the countries of the Far East. We shall have to wait to see what the consultation process reveals. But in view of the fact that we are planning to cut back the Gurkhas by about 1,000 and that we would like to concentrate on Hong Kong, we felt that we could sensibly withdraw from Brunei. That is still subject—

Sir Anthony Royle: Sir Anthony Royle rose—

Mr. Mason: I am not giving way again. I have given the hon. Gentleman a lengthy reply. I have said that the proposal is still subject to the consultative process with the Sultan of Brunei—

Sir Anthony Royle: Sir Anthony Royle rose—

Mr. Deputy Speaker (Mr. George Thomas): Order. The hon. Gentleman is a senior Member of the House and he knows that if the right hon. Gentleman does not give way he must resume his seat.

Sir Anthony Royle: I am grateful to the right hon. Gentleman for giving way. I wanted to thank him for his assurance that the decision over the Gurkhas in Brunei is not final and is now being reconsidered.

Mr. Mason: I hope that the hon. Gentleman does not try to push it too far by saying that this is being reconsidered. I said quite clearly that this is a proposal. We have to go through the consultative process. By the time the White Paper is prepared we shall be able to take a decision. I have given the hon. Gentleman a lengthy reply and I hope that he will not push it too far.
Within the NATO area we are concentrating our efforts on those commitments and capabilities where we judge our contributions to be most effective and essential. These priorities are, first of all, our land and air forces in the central region of Europe, where the Warsaw Pact confronts the alliance with a marked superiority in manpower and conventional weapons. It has a superiority of about 2½:1 in tanks and 2:1 in field guns and aircraft. The Warsaw Pact has over 20 per cent. more soldiers and 30 per cent. to 40 per cent. more soldiers in fighting units. In addition, the Soviet Union enjoys formidable advantages of geography and reinforcement over secure and relatively short routes and continues


to introduce ever more sophisticated army and air force equipment. That, therefore, is our first priority.
Our second is with our sea and air forces in the Eastern Atlantic and Channel areas, where we provide the bulk of the maritime "ready" forces available to NATO, and where, if our alliance is to deter the Soviet Union in times of tension, not only from open acts of aggression but from the range of opportunities for exerting pressure by means short of aggression which sea power so readily provides, we and the other European navies must be able to preserve the use of the high seas for NATO and make it possible for the United States to reinforce Europe by sea as well as by air. This calls for an evident ability to counter the growing maritime power of the Soviet Union, particularly its submarine force, which already out-numbers that of NATO by nearly 2:1.
Our third priority will be our sea, land and air forces for the direct security of the United Kingdom, including the ability, which will not be imperilled by the review, to continue to deploy adequate numbers of troops in Northern Ireland. We must also assure the use of the home base for operations in support of our NATO allies. In addition, we propose to maintain the effectiveness of our Polaris forces. This force is assigned to NATO. The premium is not large. The cost of operating and maintaining an effective Polaris force over the next 10 years is a tiny fraction of the defence budget.
In our examination of NATO commitments we have looked particularly hard at our planned reinforcement and intervention capabilities by sea and air, an area in which we felt it would be possible to make savings without prejudicing the viability of contribution to NATO. Our specialist reinforcement and assault forces were originally developed to meet our worldwide commitments, as an alternative to maintaining large garrisons overseas. They comprised, in addition to the land element, large air transport and helicopter forces and an amphibious assault capability. But we cannot in future afford to provide the army element of these forces with all the heavy and sophisticated equipment they would need to play a full part in a

mobile, mechanised European war. Nor can we afford to provide all these reinforcements with the air and other transport capability to enable them to be deployed worldwide or even throughout the whole NATO area. We therefore feel that we should reduce the size of these specialist forces, thereby making savings in their support and specialised transport. We plan, therefore, to reduce the land element of the United Kingdom Mobile Force assigned to NATO to about one-third of its present capability.

Mr. Peter Viggers: If the Government have approached this problem with an open mind, as they say, in view of the statistics which the right hon. Gentleman has given us on the comparative strength of the Warsaw Pact and the NATO allied countries how can they now wish to cut defence expenditure?

Mr. Mason: I must stress that, although I gave the Soviet and Warsaw Pact figures, it is not Great Britain alone against the Soviet Power and that of the Warsaw Pact. We are playing a part within the NATO alliance. We want to play our part according to what our economy can bear. Therefore, not being able to effect the savings we want from non-NATO commitments, we are obliged to look at NATO. During the course of this we have tried to maintain a credible defence posture within NATO and to look at the areas which we can sensibly cut back. I am now outlining to the House where I think our cuts can be made.
I have said that we shall reduce the land element of the Mobile Force assigned to NATO to about one-third of its present capability. Secondly, we shall withdraw our present Joint Airborne Task Force contribution. We want to maintain a limited parachute capability. We propose making no change in our contribution to the Allied Command Europe Mobile Force of 1 Battalion Group, its supporting units and helicopters, and the Harrier air element. This allied force can be deployed in the NATO area at the discretion of the Supreme Allied Commander Europe, either in the centre or on the flanks.
The Royal Marines, which provide the landing forces element of the amphibious force, would be reduced by about 1,200 men, including the disbandment of one Commando in due course. We should no


longer plan to replace our existing amphibious ships with new purpose-built vessels. The three remaining Commandos will remain committed to NATO, and the Royal Marines will continue to perform its traditional rôles. We shall be examining the best means of deploying the Commandos in the longer term without the use of purpose-built transport, when the existing amphibious ships reach the end of their useful life. The "Fearless", "Intrepid" and "Hermes" are planned to remain in service for some years to come.

Mr. Peter Rees: In view of what the right hon. Gentleman has said about the cuts in the Royal Marines, will he tell the House what amphibious rôle he sees for the Marines outside Europe?

Mr. Mason: I do not see a big rôle, for the Royal Marines outside Europe. The reduced forces—the Commandos and the assault forces—will be available for the northern flank. Those forces will be committed to NATO, and I would see that as their main task in the future.
There will still be a small intervention capability outside NATO but it will be small, and if it is to be effective it will be slower than it has been in the past. We shall not be able to move assault forces into any non-NATO area as rapidly as in the past. I am afraid that once we cut back defence expenditure in this fashion, although we have done it in what we think is a sensible and rational way, we have to recognise that the NATO rôle will be our main rôle and the assault forces, including the Commandos, will be committed to NATO, mainly to the northern flank.
The reductions we have proposed in our maritime forces both outside the NATO area and in the Mediterranean will enable us to maintain the strength of our contribution to the crucial sea area of the Eastern Atlantic and the Channel. I believe that that contribution is still a substantial one, amounting currently to an average of 40 surface ships and 20 submbarines which form the backbone of NATO's "ready" naval forces deployed in these forward areas.
The current strength of the RAF Nimrod maritime patrol force based in the

United Kingdom is to be maintained and we shall refit these aircraft so that they can counter the more sophisticated submarines of the future. We mean to maintain that contribution as a balanced force, including high quality ships. The fact is that the quality, as well as the size, of the Soviet Navy is advancing by leaps and bounds. If our fleet is to continue to contribute to the deterrence of Soviet sea power we must have quality too. For this reason the nuclear-powered submarine programme will be continued, as will the cruiser programme. The anti-submarine capability of our new cruisers, for example, will be very much greater than that of all the frigates we could purchase with the same money. If our Navy is to be credible in the eyes of both the Soviets and our allies its capabilities must be recognised. Therefore, although there will be some reduction in the rate at which new ships and weapons enter service, there should be no basic change in the planned shape of the fleet.
The Army's re-equipment programme, much more than those of the other Services, consists of a large number of relatively small projects. Numerous and substantial modifications will have to be made to this programme in order to reduce the growth of its cost. I do not propose to recite a list of the changes, particularly as final decisions have, in many cases, still to be taken, but I have already announced that the likely measures will include reductions in the planned purchases of light helicopters and reconnaissance vehicles, including the cancellation of Vixen, and withdrawal from the collaborative RS80 general rocket support system. We are consulting our partners and suppliers on these matters.
The Army's other main collaborative projects—the FH70 towed gun and the SP70 self-propelled gun, both of which we are developing with Germany and Italy, are unaffected. We are proceeding, with several of our European allies, with the purchase of the Lance tactical nuclear missile system from the United States as a replacement for Honest John.
Our proposals for the Army would reduce the manpower by about 12,000 compared with the strength in April this year. But the extent of the reduction, and its timing, is a matter on which we


shall be consulting our partners and allies.
One point which I should emphasise is that we do not propose, in advance of a satisfactory agreement on mutual and balanced force reductions between NATO and the Warsaw Pact, to reduce the forces which we maintain in Germany in accordance with our Brussels Treaty obligations. We shall retain our ability to reinforce BAOR in time of emergency or war.
No reduction in the size of the TAVR is proposed. Indeed, with a smaller regular Army, it will be an even more important and effective partner for the regular Army than before. We shall look to improve its present strength, and we plan a major recruiting effort in the New Year.
So far as possible, we shall achieve the reduction in Army manpower by structural adjustment—that is, by such measures as pruning overheads, reducing the size and number of headquarters and extending spans of command. This process of adjustment will cover the Army as a whole, but it will mean some major changes in organisation. However, its objective will be to preserve combat strength and efficiency and, where possible, to increase it. We shall also make every effort to avoid a significant impact on the loyalties and traditions of the regimental system.

Mr. Neville Trotter: Can the right hon. Gentleman assure the House that the Parachute Regiment will continue in existence as a regular body, or is it intended that the parachute capability will be confined to the regulars of the Special Air Service?

Mr. Mason: I passed that matter some minutes ago. The hon. Gentleman just caught up with it. I said that the commitment of the parachute battalions to NATO would be cut back and we would retain a limited parachute capability. That is one of the savings we are effecting.
Our proposals for the Royal Air Force will inevitably affect the strength and deployment of the Royal Air Force. The review of commitments and priorities which we have undertaken will make it possible to reduce the air transport fleet by half and allow some reduction in the planned helicopter strength.
The final extent of the reduction and the composition of the residual force are matters which must await the outcome of consultations with our allies and partners, but, clearly, changes of this order will enable us to achieve economies in engineering effort and numbers to be trained for air crew and ground duties, and by these and other rearrangements reduce the number of RAF stations by about 12.
Again, the proposed changes in overseas deployments will inevitably lead to some reduction in the Royal Air Force Regiment and, in the longer term, in maritime patrol aircraft. But by making the most of the economies which flow naturally from the review of our commitments we can concentrate our air power on our major priorities in NATO and so preserve in all essential respects the combat strength of the Royal Air Force in RAF Germany and in the United Kingdom.

Mr. Michael Brotherton: Mr. Michael Brotherton (Louth) rose—

Mr. Mason: I have given way enough. I should make progress.
It is by means of this policy of greater concentration on our essential NATO commitments that we are able to continue with the current Jaguar re-equipment programme, introduce the Phantom into the air defence rôle, and so improve the combat capability of the RAF. To ensure that that capability is maintained in future, we are continuing with the MRCA collaborative programme—a project which I believe most hon. Members on both sides recognise as being of major importance to the RAF and to the future of the British and European aircraft industries.
We currently plan to have 385 MRCAs. But as we plan the RAF budget over the years ahead we expect to have to spread the costs over a somewhat longer period. We shall, therefore, be discussing with our German and Italian partners some slowing down in the rate at which we will take delivery of the MRCA.
The general prospects so far as the RAF is concerned, apart from the transport fleet reductions, are encouraging. The proportion of combat forces within the total will be increased. Its front-line combat strength in the United Kingdom


and Germany will be maintained in numbers and quality, and it can look forward to a substantial re-equipment programme. Throughout all three Services we have also sought economies in overheads, headquarters staffs and support. Considerable economies have been made in the past, but I am determined that, following a major re-shaping of our front line, we shall pursue new economies in this field.
My proposals would result in a reduction of about 35,000 Service men from the strengths at 1st April of this year and about 30,000 directly employed civilians. Of the Service figures, 5,000 will come from the Royal Navy and Marines, 12,000 from the Army, and about 18,000 from the Royal Air Force. Of the civilians, about half will be locally entered, serving abroad.
I wish to stress once again that these figures are approximations at this stage and will be determined according to our consultations over the next few months. Only after the process of consultations is over shall I be able to give firmer estimates but we expect to make the bulk of the reductions, Service men and civilians, in the course of the next five years.
I have stressed in the House before that the morale and well-being of the Services and of the civilians employed by the Ministry of Defence is one of my primary concerns, and I shall be taking all the steps I possibly can to ensure that the process of adjustment will be largely achieved by normal wastage, and, where necessary, some adjustment to recruitment targets.
Fair terms will be offered to those made redundant, and we shall be looking into the help that the Government can give with resettlement of Service men into civilian life.
The Services will still continue to offer a wide range of rewarding career opportunities for young men and women. We shall continue to need men and women of the highest calibre for the Armed Forces. We shall need to maintain a satisfactory balance of ranks, ages and skills and good career structure. We shall continue to recruit keenly and provide full and worthwhile careers for all those we recruit.

Mr. Tam Dalyell: On the question of resettlement, is my right hon. Friend aware that those who represent new towns are finding a trend whereby it is increasingly difficult for ex-Service men to be accepted on new town housing lists? Will the Ministry of Defence exert some pressure in this regard?

Mr. Mason: I am obliged to my hon. Friend. We are aware of the problem and have been working with the Ministry of Housing on it. We are trying to encourage local authorities to put Service men on the waiting lists when they have completed their engagements. That will be all the more essential as we work through the proposed programme.
I trust that what I have said will be borne in mind by young people all over the country and by those who advise them on their careers, and I earnestly hope that the House, in debating our proposals seriously and responsibly, will do nothing to undermine public confidence in the Services, which is so important both to them in the difficult rôle they have to play and to all of us who rely on them to such a great extent.
In our deliberations on the defence review we have been very conscious of the industrial and employment implications of our proposals and have weighed them very carefully in coming to our provisional conclusions. They will be borne fully in mind when we take our final decisions. It may be some time before the adjustment to equipment proposals, which will be a properly planned and orderly process, is fully reflected in the work load of individual firms or factories, but talks have already been begun with the firms engaged on the projects that I mentioned in my statement.
Among these is Westland, at Yeovil. The main effect of cuts in requirements for helicopters will be felt by Westland towards the end of this decade. Rolls-Royce's engine production at Leavesden will also be affected. On the aircraft side I also mentioned the MRCA. A reduction in the planned rate of delivery for the Royal Air Force will affect the production of BAC in Lancashire, and of Rolls-Royce at Bristol, which is responsible for the RB199 engine. In the vehicle industry and in the conventional armaments I mentioned the


tracked reconnaissance vehicle, which is the responsibility of Alvis at Coventry, and the RS80, which is the responsibility of Hunting at Bedford.
I shall be in close touch with my right hon. Friends the Secretaries of State for Industry and Employment over any particular difficulties that may arise, but in general I feel confident that these problems will prove manageable. Much will, of course, depend on flexibility in switching to civil work and the success that we are able to achieve in our vital export markets, both civil and military.
I am satisfied that the financial savings against the previous plans will be very large indeed and will be found as a result of a positive redirection of our defence effort to areas where it will be most effective for the security of Britain and of the alliance as a whole. That has been made possible only through the vigorous analysis of capabilities against firm priorities which has been achieved.
Compared with the long-range estimates of defence expenditure as they stood in March, I shall be able to save about £300 million in 1975–76 and similar sums in each of the two succeeding years, about £500 million in 1978–79, £600 million to £700 million in each of the succeeding four years and about £750 million in 1983-84, in all a total of £4,700 million. I do not believe that anyone can say that that is not a very large contribution to the resources needed for improving the balance of payments, for productive investment and for economic growth. By reducing defence spending by several hundred million pounds a year over the next 10 years, I shall have fulfilled the Government's pledge to reduce the cost of defence as a proportion of GNP.
Within the total resources that we can devote to defence, we are putting forward to our allies at this stage provisional conclusions rather than final decisions. Final decisions will not be taken until the process of full and meaningful consultations with our allies has taken place. In my recent statement I briefly indicated how consultation is to be fulfilled, but I should like to elaborate a little on the procedures involved and the timetable we have in mind

In parallel with the statement of 3rd December, we informed our allies outside NATO of the proposals which involve them or their interests. We invited them to make their views known to us and offered to discuss with them our views on minimising any problems which our proposals might create for them. The review has been received with a sympathetic understanding of our problems and the situation which has led us to carry out this review.
Arrangements are already in hand for further consultation. Some talks at official level have already taken place with New Zealand on the practical consequences of our withdrawal from Singapore, and further detailed planning will probably take place early in the new year. The visit to London of the Prime Minister of Australia this week will offer an opportunity to hear his views. We have already begun the detailed consultations with our NATO allies on the changes we propose to our NATO commitments.

Mr. Patrick Cormack: Will the right hon. Gentleman assure the House that these are true consultations in the full meaning of the word and not briefing sessions and, therefore, that all the matters he has mentioned are open to some degree of change?

Mr. Mason: Yes, I thought that I had stressed that early in my speech. They are genuine consultations. Our allies are being made aware of our proposals, and now consultations are to begin.
There is an established procedure for this, involving, first, an appreciation by the NATO military authorities of any proposals by a member country which constitute a major change in declared forces. This is followed by political consideration of the military assessment by the NATO Defence Planning Committee. A presentation was made to the NATO Military Committee and to the NATO Defence Planning Committee in Permanent Session on 3rd December when I made my statement to the House. I have already participated in ministerial discussions in Brussels last week. I took the opportunity to emphasise our firm commitment to the alliance, and to explain to my colleagues the basic principles which have guided us in the defence review.
I believe that those meetings were both successful and important to them. They really believe that we are involved in genuine consultations with them. We have given them eight weeks to consider our proposals.
As many hon. Members will be aware, one of the main topics of discussion was the question of standardisation and increased collaboration on equipment. I stressed the importance of progress in this area and made some specific suggestions, relating, for example, to the FH70, SP70 artillery projects, the Anglo-French Lynx helicopter, and the new light-weight torpedo which we are developing.
There was general agreement—and in this I include my colleague the United States Defense Secretary—that progress on standardisation of equipment must involve genuine "two-way" traffic between the European allies and the United States. At the Defence Planning Council meeting during the past week, I thought that it was a breakthrough that the United States Defense Secretary should at least acknowledge that principle.
No one present doubted that there was much to do, but all within Eurogroup were determined to proceed along these lines with greater vigour than hitherto. I shall have perhaps a special opportunity to do so, since I have accepted the invitation of my Eurogroup ministerial colleagues to act as their chairman during the coming year.
Our NATO allies are now considering our defence review proposals in detail. If we are to give them, as I am sure we must, adequate time to digest what we propose and to give us a considered reaction, we shall not be in a position to set out our final decisions until the White paper.
In conclusion, let me stress the following points. We have framed our proposals responsibly and with full regard to the need to maintain the viability of our contribution to the Western alliance and the security of the home base. They do not imperil the security of the State. If anything, I believe that this retrenchment enhances our ability to concentrate upon our defence priorities, particularly our rôle as a European Power, irrespective of whether we stay within the EEC.
What we have proposed, however, will certainly start to release resources to help us gain our economic health, without which no defence posture in NATO or elsewhere would be of any use. But I must emphasise to all who believe in a reasonable defence posture for Britain, to all who believe in the NATO alliance, to all those who recognise that we cannot go on policing the world, that a new clearly denned defence rôle is necessary. and that is inherent in our review.
We promised the electorate that we would save several hundred million pounds over a period, and that our defence burden would be brought into line with that of our main European allies. We are now bent upon that task. I know that many may ask" what price survival?" Let me say that a Government's greatest service to their people is that of the preservation of life and freedom. The Government value that concept dearly. They are satisfied that my proposals do not imperil the security of our nation but strengthen our defence posture, and will enable us to play our part in the defence of the West and its freedoms, I believe, much more efficiently than before, and, after all, a country's defence will only be as strong as the economy permits.

5.20 p.m.

Mr. Peter Walker: I beg to move, at the end of the Question, to add:
and regrets that the proposals contained in the Statement will imperil the nation's security.
I first thank the right hon. Gentleman the Secretary of State and the Government for agreeing to extend the time for the debate so that more hon. Members on both sides of the House can contribute to it. I believe, Mr. Deputy Speaker, that you have received no fewer than 40 applications from hon. Members wishing to speak in the debate, and this indicates how desirable it would be to have another day to debate this topic soon after the Christmas Recess.
The review which the right hon. Gentleman has just defended was a review which we always looked upon with considerable fears and anxiety. It would be true to say that the worst of our fears have not been met in that I suppose the worst of our fears were that the right hon Gentleman might have produced a review


that had resulted in his hon. Friends below the Gangway deciding not to move an amendment at all. The fact that they have put forward an amendment shows that the right hon. Gentleman has not gone to the irresponsible extreme to which he was urged to go by both the Labour Party conference and a large number of members of the Parliamentary Labour Party prior to the February General Election.
Our basic fears of the review are illustrated by the events and the announcing of cuts by the Secretary of State. The first thing that was wrong with the review from our point of view was that it was not a review conducted to see what were the defence requirements of our country. It was a review conducted to see how best the Government could comply with the expressed wish of the Labour Party to reduce expenditure on defence. This has put the Secretary of State at a basic disadvantage in that he was not free to look at our defence needs and say what was required. He was free only to argue what reductions should not take place and what reductions—perhaps many of them—he had reluctantly to concede.
The second outstanding weakness of the review concerned the basis behind it. It must be the first defence review in history in which the basis was the strength of our allies, not of our enemies. The whole attitude, from the commencement of the review, was to try to bring us in line with what the allies were contributing, not with what our potential enemies were doing. That is no way to conduct a review of the defence arrangements of our country.
The third factor was the constant manner in which the basis was concerned with GNP comparisons. This is a "phoney" method of dealing with the problem. It is "phoney" for a number of reasons. First, I judge by the peroration to the Secretary of State's speech that he would never concede that investment in defence should go up and down according to the strength or weakness of the economy. Even firms in dire straits would continue to pay their fire premiums even though they could not afford other expenditure. The Secretary of State must agree that defence is a fundamental and basic form of expenditure which should be diminished only if the world situation enables that to happen. But it is a

"phoney" comparison to look at the GNP of other nations.
It is a fact that many of the comparisons made are with countries that have conscription, not voluntary Services. In those countries with conscription the actual payments paid to the armed Services are much lower than we pay in this country to our volunteer forces. Other countries put in separate budgets much of the social expenditure involved in the armed Services. Other countries, like France, do not put the whole of nuclear costs into the defence budget, but spread them throughout other budgets within the Government system. For all those reasons comparison on a GNP basis was nonsense.
With regard to future projections, it is interesting to learn from one of the few Written Answers that actually give answers to Questions that this proportion of GNP is based upon an assumption that over the next 10 years the nation's GNP will rise by 3 per cent. per annum. Judging from the present form of the Government in relation to the economy, if they remain in office we shall not reach that figure at all. The other argument on which figures are based is that of constant prices, and there is no need to comment on that. But it means that, as an hon. Gentleman below the Gangway complains, figures for savings in, for example, 1976–77 of £270 millions are unlikely on these projections to be met in reality.
What of the argument that we are paying more than our share of the security of the Western world? If we take this on a per head basis we find that we are paying rather less than our share. The United States is paying £152 per head, Germany £81, France £76, and the United Kingdom £63, almost identical to Norway. France is spending £250 million more on defence than we are. Western Germany is spending £1,300 million more than we are. Therefore, for this Government —bearing in mind the present figures, not those in the review as outlined by the Secretary of State—to decide on further substantial cuts on a unilateral basis, and not on the basis of negotiation with the Warsaw Pact countries, is a thoroughly bad example to the Western alliance.
The reality is that world wars do not start because of the aggressiveness of democracies. The political leaders of the democracies are far too close to the


people they represent and share with equal anxiety their repugnance of war. In this century it is the totalitarian régimes —of both Left and Right—which have been the real threat to world peace. World wars start, therefore, when the democracies are too unprepared, too frightened, and too cowardly—or just too tired.
The major totalitarian Power in the world today, in terms of military might, is the Soviet Union, and it is significant that the Soviet Union has described the present defence review as being a step in the right direction—

Mr. Frank Hooley: If the right hon. Gentleman took the trouble to visit the cemetery in Leningrad, where there are 450,000 dead Russians as a result of the last war, he would not talk so airily about the indifference of the other people to war.

Mr. Walker: Perhaps I would if any of the 450,000 had ever had the right to vote in a democratic election.
Let us look at the attitude of the Soviet Government to the problems we are considering. The Soviet Government are not pursuing a course that the hon. Gentleman and his Friends constantly urge upon British Governments. They are not embarking on a course of disarmament at present. Year by year, as talks on disarmament continue, Soviet military might is increasing. A Soviet nuclear submarine is produced every month, and Soviet naval activity spreads throughout the world. In the Indian Ocean it has quadrupled in the past six years, and in our seas Soviet spy-ships photograph our vital North Sea installations. The Soviet Union invests millions of pounds in a new port in the Indian Ocean, and Britain, under pressure from hon. Gentlemen below the Gangway, seeks to abandon her facilities in Simonstown.
We have a situation in which as the Secretary of State said, the Soviet Union at present has twice as many submarines as the Western Powers. The Secretary of State's response is to reduce the number of aircraft suitable for chasing and destroying submarines—

Mr. Newens: Will the right hon. Gentleman state some of the things that

the United States is doing to spread its military power throughout the world? The right hon. Gentleman does well to speak of Soviet growth and investment in the Indian Ocean. Will he also mention that in the Government's defence review we have agreed to further development by the United States at Diego Garcia, for them to have a base there? It is not one-sided. I am not defending the Soviet Union—

Hon. Members: Oh.

Mr. Deputy Speaker: Order. The hon. Gentleman hopes to catch the eye of the Chair later. Long interruptions mean fewer speakers.

Mr. Walker: The day Pravda criticises the hon. Gentleman will be a day of rejoicing.

Mr. Newens: On a point of order, Mr. Deputy Speaker. Is it in order for the right hon. Gentleman to make smears which he cannot justify about another hon. Member?

Mr. Deputy Speaker: It is never in order to imply unworthy motives, but I do not think that that is what the right hon. Gentleman was doing.

Mr. Walker: I am delighted that at last the hon. Gentleman considers that being criticised by Pravda is a smear.
I hope that hon. Members and the country at large will realise just how much the defences of the West have been eroded in the past decade compared with the Soviet Union's. In 1964 the United States had four times as many intercontinental ballistic missiles as the Soviet Union. Ten years later the Soviet Union had half as many again as the United States. In 1964 the United States had more than three times as many submarine-launched ballistic missiles as the Soviet Union. By 1974 the Soviet Union had many more than the United States. In the same decade the United States reduced the number of men under arms by 500,000. The Soviet Union has increased the number of men under arms by 125,000. The West constantly cuts back on its investment in research into new weapons. The Soviet Union year by year increases its investment in improving the effectiveness of its offensive weapons. Project this trend a further decade, and we see that Soviet military might will be


so dominant as to enable its Government to dictate to the Western world.
I hope that when the Secretary of State prepares his White Paper he will consider the inclusion of an illustration of the current strength of the Warsaw Pact Powers. It would be interesting for the country to see in a White Paper not just the known strength but a projection of that strength if over the next 10 years the Soviet Union continues to increase its military might at the same pace as it has done over the past five years alone. The picture of its expanding military strength in a period when we are contracting ours would very much alarm our country.
In the face of all that, we have the review, described proudly by the right hon. Gentleman as the most thorough review that has ever taken place in peace time. It was a wrong review, because it was not to review our needs but to reduce our expenditure. Even in that context, it has been ineffective. Normally, it would probably have been completed by June or July, but it was postponed until after the General Election and then until after the Labour Party conference.
One would have expected such a time lag at least to enable the Government to come to conclusions. But a week of Written Questions since the Secretary of State's statement has shown just how uncertain has been their approach. What information has been given to the House over the past week about the Army, for example? We have been told that it is not possible to give an estimate of the phasing of the 12,000 reduction in manpower or to say where it will take place.
The Under-Secretary of State for Defence for the Army gave a remarkable reply to a Question asking specifically how the reduction of 12,000 Service men is to be spread between Army regiments. He said:
I cannot at this stage provide details about the composition of the expected reduction in Army manpower. However, I confirm that it is our intention to achieve the reduction to the maximum extent possible by pruning overheads and by structural adjustment and we shall make every effort to avoid a significant impact on the regimental system with its historic loyalties and traditions."—[OFFICIAL REPORT, 9th December 1974; Vol. 883, c. 62.]
Before completing the review, the Undersecretary should have known whether a

reduction of 12,000 men would have that effect.
Nothing is known about the phasing of the reduction of 12,000 men. There is no indication of when their numbers will be reduced, or how. The Government's position on the Army can almost be described in the words of the song "Don't know where, Don't know when." The Government only hope that the cuts will take place some day. No final decision has been taken about the reductions in helicopters and reconnaissance cars.
We are told that the Government do not know when the 5,000 reduction in Navy manpower will take place. They have not yet considered the effect on the RNVR. That is under consideration. No information is available on how the reduction of one third in support ships will be made. No decision has been taken on the future of the "Ark Royal", and the position of HMS "Bulwark" is being considered. It is not known whether the through-deck cruiser will be a one-off project or will become one of a series and a class. No decision has been taken on the future of the maritime Harrier. With that mass of uncertainty surrounding the future, how can the Secretary of State put forward firm figures as to his reduced expenditure?
I turn to the RAF. We are told that reductions in maritime patrol aircraft have not yet been decided. The extent of the slower phasing of the MRCA is not known. The phasing of the halving of RAF transport depends on eventualities, and the increased need to charter aircraft as a result is not known. It is not possible to give details of the phasing of the 18,000 reduction in manpower. The extent and speed of reduction of the RAF Regiment is not clear. As to the closing of the 12 RAF stations, it is not known which stations will close, and we are told that the information cannot be given until all relevant figures are carefully considered. If the Government have not considered the relevant figures, why did they decide to close 12 stations?
As to the civilian staff, the Minister's knowledge, after the most detailed review in peace time, is as non-existent as it is for the Armed Services. The phasing of the 30,000 reduction cannot be given, nor can the locations of those affected. We are told that it is too early to say


which shipbuilders will be affected, and too early to judge the effects of the change of policy on ship refitting. Ministers have told us that they have not decided the effects on the Royal Ordnance factories. When we asked questions about where 10,000 jobs would be lost in industry, and which firms would be affected, we were told that the 10,000 figure was a "broad order of magnitude". As for the 10 per cent. reduction in research and development, we are told that the Government have not decided which projects will be affected.
If ignorance is bliss, we must have the most contented group of defence Ministers in our history.
We dispute the international strategy which has supposedly come out of the review. The view taken increasingly by the Secretary of State, that the defence of this country is almost totally concerned with the position in central Europe, is dangerous. Ten years ago the late President Kennedy said that we must learn to think inter-continentally. That is true of NATO. The oil crisis should have taught the West the vital importance of securing our raw materials and the safety of our sea routes.
Let us look at the way in which the changes have taken place. Listening to the Secretary of State today, one might almost have believed that he had withdrawn everything throughout the world and made substantial savings. He has not. He has kept most of the overseas obligations, but has weakened the ability of the Services to meet them in time of difficulty. There is no decision about the magnitude of the reduction in Hong Kong. Does the right hon. Gentleman not consider that the garrison there is not too large to meet some of the potential problems which could arise?
The decision about Brunei and the Gurkha battalion is remarkable. We are pleased to hear from the right hon. Gentleman that it is not final. We are glad that he will consult the sultan and consider the position. The countries in that area are good allies of ours, and they judge this move as being beyond comprehension, particularly as the present situation does not cost the British taxpayer one penny. Recently, in reply to my hon. Friend the Member

for Richmond, Surrey (Sir A. Royle), who, while at the Foreign and Commonwealth Office, had a great deal to do with that area, the reply by the Secretary of State lacked only one thing—any logical reason for his decision.

Mr. Dalyell: Exactly what are the Opposition proposing? Am I right in thinking that their suggestion is that we need more troops in Hong Kong?

Mr. Walker: It is our view that the garrison is not too large. The Secretary of State is suggesting a reduction but we do not know by how many men. It has not yet been decided that there will be a reduction, but our view is that the garrison is not too large to meet some of the potential problems which may arise.
One gathers that a very small number of men is to be left in Singapore but that we are to keep all our treaty and defence obligations in that area. If the Secretary of State insists on withdrawing our forces from the area, I hope that he will consider whether there is not something to be said for retaining at least enough to look after the facilities out there on a care and maintenance basis.
The proposals for the situation in the Indian Ocean will weaken our position. We must await the results of the renegotiation of the Simonstown agreement. If it results in all our facilities at Simonstown being preserved under different names and different treaties, perhaps our criticism will be somewhat subdued. But, in fact, the renegotiation is purely political and is being carried out in order to please the Left. If facilities at Simonstown are preserved, there will be considerable relief in the light of the Soviet naval activity in the Indian Ocean. Simonstown is valuable to us because of the security information which comes from our facilities with the South African Government and which is of immense importance to protecting our sea routes.
I turn now to our position in NATO. I hoped that the right hon. Gentleman would say something about the criticisms he received, seemingly, at the ministerial conference last week about some of his decisions. We gather that the Italians were critical of the manner in which he is going to weaken our position in the Mediterranean, and that the Germans


and Americans were critical of the manner in which the northern flank will be adversely affected by the decision to do away with the amphibious force we have now. The flanks of NATO are of immense importance to the defence of the whole area. I hope that the representations made to the right hon. Gentleman by our NATO allies concerning our contribution to the northern and southern flanks will be carefully considered.
We were all relieved by the right hon. Gentleman's reference to the importance he places upon the Territorial Army. If the right hon. Gentleman pursues many of his decisions—we hope that he will not—there is no doubt that there will be increasing need to have available reserve forces and forces which can assist if necessary at a time of mobilisation. When the Government are reducing the forces to the degree they propose now, one has grave concern about the mobilisation capacity of the country in an emergency.

Mr. Robin F. Cook: It would be of assistance to us if the right hon. Gentleman would tell us whether he is aware that during the period of the Conservative Government from 1970 to 1974 the total personnel of the Armed Forces fell by 20,000. My right hon. Friend now proposes a reduction over 10 years of 35,000. He is, in effect, proposing to reduce the rate of reduction in the Armed Forces which he inherited from the Conservative Government.

Mr. Walker: We considered that the changes we made in defence expenditure were the maximum that could be undertaken in the light of our commitments. The present Government are to make further substantial reductions without reducing any of our major commitments. Added to that, we are seeing no success and no breakthrough in the disarmament negotiations with the Soviet Union, and a considerable build-up in its activities in many areas. For example, month by month we see an increase in Soviet sea power. Yet the Government have decided to make some of their biggest cuts in the Royal Navy. We condemn the nature of many of these cuts.
In terms of the capacity to mobilise, I ask the Secretary of State to tell us

whether, when he does decide which 12 airfields he is to close, after having looked at the relevant facts, he intends to keep some or all on a care and maintenance basis at least so that they could be used again if the need arose.
Our condemnation of the defence review is that it reeks of a series of expediencies to meet the pressures from one section of the Labour Party. The losses from any such expedient actions always far outweigh any temporary gains. It is not juggling with the mechanics and finance of defence which makes a nation secure, but the determination of the Government to defend the nation. The nature of this review leaves us with grave doubt about the inner spirit and determination of the Government to secure the safety of our nation.

5.47 p.m.

Mr. Frank Allaun: I wish to support the amendment tabled by my hon. Friend the Member for Harlow (Mr. Newens) and other of my hon. Friends. I regret to have to tell my right hon. Friend the Secretary of State for Defence that the cuts he has referred to in his statement are "phoney". We have been misled, or—let me put it another way—many people have been misled into believing that this defence review will mean large reductions in spending on arms. I again regret to have to say that the truth is the exact opposite. People have been misled on the matter additionally because of the way the Press has treated this point.
The savings of hundreds of millions of pounds which are being claimed are fictitious, because they are not savings in comparison with our present vast arms spending; they are savings compared with the even more fantastic proposals of the Conservative Government for arms spending over the next five years. Secondly, far from reducing spending, there is a real and cash increase compared with the £3,660 million estimated for this year last winter. Indeed, in reply to a Written Question which went almost unreported in the Press, my right hon. Friend admitted that next year, in real terms— that is, current terms—the spending is to be £3,700 million, and in the following year £3,800 million. He stated that that level is to be maintained for the next seven years.
That is spending in real terms. God knows what it will be in terms of pounds and pence. If the current rate of inflation—18½ per cent.—continues for the next five years, at the end of that time we shall be spending more than £8,000 million a year on arms. This is no minor matter, but one that threatens us with bankruptcy. Last week, an all-time record deficit of £534 million was reported in our monthly trade figures. In this serious economic situation we cannot afford to continue, never mind increase, our present rate of spending on arms.

Mr. Roderick MacFarquhar: There is no disagreement on the Government side of the House about the importance of a strong economic base for our defence forces. How would my hon. Friend explain to 70,000 civilian and Service personnel that they are liable to lose their jobs as a result of the review? How are these cuts "phoney"?

Mr. Allaun: I shall come to that if my hon. Friends will wait a few moments. I do not think that anyone who considers this matter has overlooked the problem raised by my hon. Friend. I do not want to dodge such an important question, particularly as many of my close personal friends in the engineering industry may be affected. The answer is that we believe in different employment, not unemployment.
We were to have had a two-days' debate on defence. It is ironic that this debate has been cut to one day to allow for a debate on the economic crisis. To forgo the real reductions that we can achieve is the height of lunacy.
I shall be brief, because I know that many hon. Members wish to take part in the debate. Far from lessening tension, an increase in arms spending by this or any other country, in the East or West, will increase tension and reduce our hopes of detente. Some recent Press editorials make me sick. The talk about detente while simultaneously demanding the intensification of war preparations.

Mr. Churchill: What is the Soviet Union doing?

Mr. Allaun: The same as America is doing, and I regret it more than the hon. Gentleman does.
Whether or not they like it, hon. Members on both sides of the House must admit the truth of every one of the points made in our amendment. They may not like them, but these are factual points that cannot be denied. They are statements of fact.
When addressing the North Atlantic Assembly on 14th December the Prime Minister said:
In our economic situation we can no longer afford to bear a higher proportionate burden than that of our major Western European allies.
I have been in touch with a couple of high-powered statisticians. One of them is Dr. Frank Blackaby, the Director of the National Institute of Economic and Social Research. They assure me that if we were to reduce our share of the GNP spent on arms to that spent by other Western European allies we should save £1,180 million a year. We need that money to re-equip our industry, to provide houses and schools and to reduce the rate of inflation, because nothing can be more inflationary than an arms programme of the present magnitude.

Mr. Mason: I do not want to interfere with the theme of my hon. Friend's speech, but I do not want him to believe that these are "phoney" cuts. They may not represent the savagery that my hon. Friends wants, but I hope his doctor colleague is not advising him wrongly.
If my hon. Friend wants to cut defence expenditure in real terms, he must realise that he has to stop projects that are now being built, that he has to axe Service men tomorrow and that he has to create unemployment in the aircraft and shipbuilding industries immediately, because no alternative employment is available and we have not made any plans to find other employment for those who would be made redundant.
If we were to resort to savagery in making defence cuts, the result would be higher redundancy pay and the severing of contracts. We should have to recompense the industries concerned, and in the first 12 months the saving would be very small. In the meantime, however, we should increase purchasing power by paying a higher rate of redundancy pay, increased unemployment, sever contracts and cause disarray and confusion in the defence industries.

Mr. Allaun: I recognise the reasonableness of my right hon. Friend's interjection. Having suffered a little unemployment myself, just as my hon. Friend has, neither of us is anxious to make people unemployed. But the Prime Minister said at the Dispatch Box that the dockyards can be employed on non-military work. Cammell Laird and Vickers could be engaged on building rigs for oil development, or giant oil tankers. I am glad to note that my right hon. Friend agrees with me. I accept that all this cannot be done in three months, but my right hon. Friend has been referring to a period of 10 years.
The second point of my right hon. Friend's interjection must be answered. He said that these are not "phoney" cuts. Gentlemen in the Press Gallery have reported that my right hon. Friend will save £4,700 million over 10 years. I am saying that that is a "phoney" cut, and a few moments ago, in reply to a question from me, my right hon. Friend said that there was a slight real increase in spending. It seems to me, therefore, that he has admitted the case that I am making.
My right hon. Friend's statement refers to certain savings. One of these is a manpower saving of 70,000 but, compared with the total of 700,000 employed in the Ministry of Defence, that is only 10 per cent. over 10 years.
There is a reference to savings in manpower and bases. If there is to be a reduction in certain spheres but the total bill is to increase it must mean that there will be a large increase in certain other spheres in the defence budget. I think I know what those are. Perhaps the Minister of State will deal with this matter when he replies to the debate.
I suspect that there will be a huge increase in our already vast research and development programme of £400 million a year. We know that certain items will grow. For instance, if we buy 385 multi-rôle combat aircraft, it will cost far more than the Channel Tunnel, which we agree that we cannot afford. Moreover, some of these low-flying aircraft are now highly vulnerable to missiles, as the recent Middle East war showed.
There will be an increase in the outlay on the through-deck cruisers which, with

their complement of aircraft, are estimated to cost £140 million each.
In our election manifesto, to which reference has been made by my right hon. Friend, we stated that as a first step we would seek the removal of the United States Polaris base from Britain. Why is there no mention of that in the defence review? Presumably because it will continue for 10 years. Yet we all know that it is a suicide weapon. Once released it will mean the extermination of our people. Moreover, there is no protection against similar weapons directed at this country. Indeed, it makes our whole nation highly vulnerable.

Mr. Churchill: Highly indefensible.

Mr. Allaun: The hon. Gentleman can make his own speech. I maintain that we are indefensible because we can be wiped out by a dozen hydrogen bombs in the first few minutes of the next war.
Many hon. Members and a great number of people outside this House are asking not that the Secretary of State should now say, "Very well, here and now I will cut my Estimate", but that, before producing his White Paper in March, he should have taken these views into consideration.
The Opposition are saying not that we are spending too much but that we are not spending enough. I wonder how much they think we should spend. I suggest that if we doubled our spending on defence, right hon. and hon. Gentlemen opposite, with very few exceptions, would still say that we were not spending enough.

Mr. Cyril D. Townsend: Does the hon. Gentleman agree that if we increased our conventional forces we would reduce the risk of having to use our nuclear forces—which should be his aim?

Mr. Allaun: I do not believe that there is any need for either. We could get into a long debate on this matter. I do not think that it is possible to defend this country any longer by military means. We are far more likely to have influence in the world if we are economically viable rather than economically bankrupt though militarily strong.
I repeat the question, which I hope will be taken up: how much do right


hon. and hon. Gentlemen opposite want to spend on arms? It is a bottomless pit. We could go on spending more millions, and still they would say that it was not enough. This country would still be indefensible. It would merely have the effect of increasing arms spending by other nations.

Mr. John Lee: A possible answer to the question posed by my hon. Friend is that the Opposition want us to spend as much as is necessary to wreck the economic plans of any Labour Government.

Mr. Allaun: I do not know whether that is their conscious motive, but that would be the effect.
We utterly reject the view of the right hon. and hon. Gentlemen opposite and strongly support the amendment.

6.5 p.m.

Mr. Anthony Nelson: I rise for the first time in this House to plead a cause about which my constituents and I feel most strongly. Before doing so, I wish to pay tribute to my predecessor, the right hon. Christopher Chataway, who served our country and this House for over 12 years, first as Member of Parliament for Lewisham, North and, for the past five years, as the right hon. Member for Chichester, During that time he rose to high office as Minister for Posts and Telecommunications and, more latterly, Minister for Industrial Development. Though I may lack his athletic prowess and his appeal to television audiences I shall certainly strive to maintain the same high standards and purpose that he displayed throughout his parliamentary career. I hope that this House will join me in wishing him every happiness and success in his new ventures.
It is also proper that I should tell the House a little about Chichester. It is, of course, familiar to those who enjoy sailing at Bosham and Itchenor, to those who enjoy the racing at Goodwood, to those who have visited our famous Festival Theatre, and even to those who have enjoyed rambling over our beautiful downs. Spreading for 500 square miles from the coast, Chichester is primarily an agricultural constituency surrounding the historic cathedral city. It is without

doubt the most beautiful constituency in the country, but it shares with other areas many of the same social and economic problems.
We have an efficient and productive horticulture industry which will be hard hit by the decision not to continue the growers' oil subsidy next year.
We have many small pig and beef producers who have been forced to sell their stock without the benefit of the new guarantee payments.
In common with many other parts of the country, we have a large number of families in need of housing, and, at the same time, many houses lying vacant or under-utilised.
We have the pressures of urbanisation, transport and development, which are gradually eroding the tranquil nature of our countryside and the aesthetic appeal of our city and villages.
Despite these pressing problems, I have chosen to speak on a subject which, at first sight, may appear divorced from the matters that I have mentioned. Yet my constituents have never taken for granted the state of peace that we have been privileged to enjoy for some years, nor have they been the last to respond to the call in time of need. Indeed, since Alfred the Great routed the Danes from Wessex and set up fortifications, we have been mindful of our responsibilities and zealous of our security.
I regard defence as the primary responsibility of the Government. I consider the proper and adequate security of our people to be the prerequisite to all other policies or ambitions of the Government. Without that security, those policies or ambitions may never be realised.
Moreover, I believe that we are entering a changing period of world political structure—a time when planetary politics will become a reality. We have already seen the grouping of the oil-producing countries under OPEC and the first indications that primary producing countries are becoming a collective force. We see world conferences discussing people's needs rather than their interests, and we see a recognition, both nationally and internationally, that collective economic force and power can change the balance of the world. I believe that we should welcome


all these changes, but we would be foolish not to recognise that they bring grave problems and threats to national security and to our prospects for peaceful co-existence.
I have three principal objections to the proposed cuts in defence expenditure which have been announced by the Secretary of State for Defence. My first and major concern is that these cuts will reduce the nuclear threshold—that is to say, the point at which conventional warfare will escalate into nuclear warfare. Although the definitions of nuclear and conventional warfare have become somewhat blurred, my main fear is that a major reduction in force levels will leave a gap in our defence network and strategy which can be filled only by the nuclear deterrent. The reduction in the number of the Royal Navy's frigates and destroyers by one-seventh, the reduction in the number of conventional submarines by one-quarter, the cancellation of the RS80 long-range artillery rocket and the reduction in the rate of deliveries of the MRCA, about which we heard today, provide exactly such a gap in our front-line forces.
The British Government have played a full part in the Geneva Conference on Security and Co-operation and the Vienna Conference on Mutual and Balanced Force Reductions, and have had consultations with the United States in regard to the Strategic Arms Limitation Talks. Today we have heard of the importance placed on the Western alliance. But the House must ask for far more visible evidence that limitation and non-proliferation of armaments is being undertaken before we, as a House, sanction the unilateral dismantling of our own armaments.
My second objection concerns our inability to counter the massive build-up of Soviet armaments and forces throughout the world. I am reassured genuinely that the present Government accord high priority to our NATO contribution. But NATO does not cover many parts of the world where Soviet forces extend. Indeed, in the last 10 years the Soviet deployment of warships in international waters has increased by over 10 times. Soviet industry is building over 700 fighters a year. Massive sums are being spent on the production of the new swing-wing bomber, called—somewhat optimistically—"Backfire", for which there is no equivalent in

the West. Research and development— we have heard again today—account for one-third of Soviet defence expenditure. Indeed, it was the present Secretary of State for Defence who was moved to say in the House of 2nd July:
I warn the House that there is on its way a new generation of sophisticated advanced weaponry coming from the Soviet Union."— [OFFICIAL REPORT, 2nd July 1974; Vol. 876, c. 256.]
Negotiating from strength has always been a basic element of Soviet foreign policy. Yet no one should be deluded that this build-up is for ceremonial purposes. In central Europe alone the Soviet forces that are evident are far more than are needed to deter attack, and in the Indian Ocean far more than our joint and token contribution with the United States in Diego Garcia can hope to contend with. In these circumstances, is it surprising that a reduction of 35,000 in the number of British Service men and a reduction in the planned defence programme will be welcomed only by the Soviet Union?
Thirdly, together with my hon. Friend the Member for Richmond, Surrey (Sir A. Royle), I much regret the Government's proposal to withdraw our forces stationed under the five-Power defence arrangements in South-East Asia—particularly the withdrawal of over 3,000 Service men from Singapore. The White Paper on Defence last year concluded that Britain's
world-wide political and trading interests cannot flourish without stability outside Europe.
We seem to have forgotten or ignored that it is barely 10 years since we were defending Malaysia against Communist infiltration from Indonesia and from the mainland further north, and that we successfully defended Malaysia and our interests therein.
The air bases in Singapore provide excellent runways for tactical and strategic bombers, as well as dispersal facilities for aircraft with nuclear capability. The naval base has provided valuable facilities for ship refitting.
Having lived for a number of years on one such base—RAF Changi, in Singapore—and having had the privilege of travelling extensively throughout the Far East, I feel to some extent qualified to tell the House of the value and reassurance that our presence in that island affords to many, many people whom I


have met from other countries which are signatories to that five-Power agreement —that is, Singapore, Malaysia, New Zealand and Australia—and not least to our countrymen who live and work in that part of the world.
As a young man, I recognise that I cannot draw on the experience of many who will wish to contribute to the debate, but I believe that I can say with genuine concern that decisions taken now will have to be paid for by my generation and future generations. I urge the Government most strongly to think again before undertaking such an irrecoverable course of action. History should surely have taught us that defence has always been easy to cut but never easy to build up in a time of emergency. Who among us is brave enough to say, at a time of increasing international terrorism and military insurgence and aggression, that such an emergency will not again exist for this country? Greater voices than mine have pleaded in the House for adequate defence for this country. However, the kind of attention which hon. Members have afforded to me this afternoon encourages me to hope that this time, perhaps, these words of warning will not fall upon deaf ears.

6.15 p.m.

Mr. Stanley Newens: It falls to me to congratulate the hon. Member for Chichester (Mr. Nelson) on his speech. I do so with great pleasure. I agree with him very much about the beauties of his constituency—just about as strongly as I disagree with him in his views on defence Nevertheless, I think that the whole House will have recognised the sincerity with which he expressed those views. All of us will look forward to listening carefully to what he has to say in the future.
As my hon. Friend the Member for Salford, East (Mr. Allaun) said, today's debate is taking place against a background of economic gloom and acute anxieties about the future of our country. All around there is a rising chorus of demands to tighten belts, to roll up sleeves and to stop living beyond our means. Yet any impartial observer would search in vain for evidence on the Opposition side of the House that the compelling impending peril of the economic situation has

penetrated the consciousness of many of those who discuss these defence matters.
The right hon. Member for Worcester (Mr. Walker), I fear, is too politically illiterate to understand that there are some people who can oppose defence expenditure without being spokesmen for Soviet policy. I myself, having in the past denounced such crimes as the Soviet intervention into Hungary and Czechoslovakia and the way in which, at the same time, the Soviets have developed their armaments, strongly resent the suggestion that the views which I am expressing now are merely a reflection of the views of Moscow. I hope that the right hon. Gentleman and some of his hon. Friends will take that into account in the future.
The present Government came to power committed by a manifesto which said that we would seek
to reduce the proportion of the nation's resources devoted to defence so that the burden we bear will be brought in line with that carried by our main European allies.
Such a realignment, we were told, at present levels of defence spending—not future levels—would mean achieving annual savings of several hundred million pounds, over a period on defence expenditure. As my hon. Friend the Member for Salford, East has shown, the savings which my right hon. Friend the Secretary of State has postulated are economies on future and not present levels of expenditure. As such, many of us do not regard what he is doing as being in line with the promises which we made in the manifesto.
The defence review does not mean an immediate reduction, either, in the proportion of the nation's resources devoted to defence, as compared with that of our main European allies. It means merely the designation of a distant target. The projections on which that target is based, as my hon. Friend the Member for Salford, East has shown, are estimates of economic growth in the United Kingdom, Europe and elsewhere which are highly tendentious. They also depend upon assumptions of a degree of stability and predictability in international affairs which is absent and upon the ability of one Defence Minister to bind his successors, which he cannot.
In these circumstances, the major economies which we have heard are to


be made are not for immediate realisation but for future achievement. They certainly will not satisfy people like myself, either in the House or in the country at large. The prognostications of my right hon. Friend about what will happen in 10 years' time are no better guide to the situation as it will be at that time than are the speculations of Old Moore's Almanac.
My right hon. Friend has not announced the cancellation of, or drastic changes in, any major weapon projects. He made it clear that he will carry on, albeit with some delay, with the MRCA, the through-deck cruiser, and so on. The result is that savings will be insufficient to help even to stabilise the present level of costs.
Although my right hon. Friend has said that we will concentrate on NATO, we are still prepared to shoulder a whole variety of commitments east of Suez. I refer to one in particular, namely, the commitment in Oman. British forces, whether seconded to the service of the Sultan of Oman or posted to British bases there, are engaged in operations to suppress the liberation movement in Dhofar. The Labour Party manifesto published in October 1974 said:
We will continue to support the liberation movements of Southern Africa.
How, then, can we justify the suppression of liberation movements elsewhere? The argument is advanced that this particular liberation is supported from abroad and receives Soviet arms. Does not the same argument apply to some of the liberation movements in Africa? If the major objection is to intervention by external powers, do we view with equanimity the introduction of Iranian forces from across the Gulf into Oman?
I believe that we should seek to neutralise the area and initiate talks for the withdrawal of all foreign troops, including the British, from Oman. As long as we are prepared to continue to support that régime we can expect only that those who oppose it will seek reinforcements and armaments from abroad.
My right hon. Friend has said on numerous occasions that the purpose of defence is to defend democracy. What democracy, in any sense that we can understand, exists at present in Oman?

Mr. Churchill: What about South Yemen?

Mr. Newens: I agree that in many of those areas of the world there is no democracy and that we should be seeking to help in any way that we can to lead those people forward, but we shall not do it merely by supporting the most reactionary forces in those countries, as we did in the 1950s and 1960s in the case of the South Yemen, thus driving the people there into the arms of the Soviet Union.

Mr. George Younger: To clarify the mind of the House on this matter, will the hon. Gentleman agree that there is no democracy behind the Iron Curtain, and do his remarks apply there also?

Mr. Newens: I agree that the degree of democracy behind the Iron Curtain, as in many other parts of the world, is very unsatisfactory from our point of view. I am not prepared to justify everything that happens in the Soviet Union, in the United States, and in those countries which happen to be in the orbit of the United States round the world. I endeavour to judge those countries in an even-handed manner.
The decision to permit the expansion of the United States to the Indian Ocean, which we are at present countenancing by allowing Diego Garcia to be developed, is totally wrong. The majority of nations bordering the Indian Ocean wish demilitarisation to occur there, yet we permit the United States to build up on Diego Garcia as a base. It may be that this is some sort of quid pro quo for Simons-town, as David Wood suggested in The Times today, but I believe that it is part of a policy which the United States embarked upon even in the 1960s to establish a base in that area from which she would be free to send forces to any part of Southern Asia where she wished to preserve what she regards as stability.
I turn to the question of Soviet naval bases in that area. If previous British policies in Aden and South Yemen had not been entirely in support of the sheikhs and the forces of yesterday, we might have enjoyed much more sympathy in that area than we do today. We must ensure that British policy throughout the world is put in tune much more with the progressive movements that are not necessarily dependent on the Soviet Union and which


are inevitably coming to light in all the under-developed countries.
At present, the major expenditure is occurring in Europe. As one who does not believe in British membership of NATO, I say that we cannot continue indefinitely to support the heavy burden in foreign exchange costs involved in the maintenance of forces in Germany. Every year for several decades Western Germany has received an inflow of funds against our outflow produced by Great Britain's accepting a burden of which western Germany is free. We all know that in recent years western Germany and Japan have achieved much higher rates of economic growth than we have. One of the reasons for that is the comparative freedom those countries have enjoyed, for many years, from the military burden which we have been prepared to shoulder.
We must recognise that we cannot go on with this burden indefinitely and that sooner or later we shall have to cut those forces back on economic grounds. Does it make sense to allow funds to be drained from this country while we have to go cap in hand to Saudi Arabia and Iran and ask them to keep their investments here so that we can somehow avoid economic collapse? That is not the sort of strength that the British people believe in. I believe that sooner or later there must be a change. I am anxious that we should press for its achievement rather than that things should be allowed to drift on as at present.
I accept the argument about the buildup of forces by the Warsaw Pact. I should say, in all fairness, that the figures reveal that most of the European members of the Warsaw Pact, except the GDR and the Soviet Union, spend a lower proportion of their GNP on defence than does Great Britain. The Russians spend considerably more. As far as possible we should seek to bring about the earliest possible withdrawal of all Soviet forces from eastern Europe—[HON. MEMBERS : "Hear, hear."] I am glad to hear Conservative Members supporting that. I hope that they will be prepared to support what I say is the corollary. If we are to bring about that withdrawal we must work for the withdrawal of the forces which are at present deployed by the United States and by NATO in western

Europe. We cannot expect anything to occur if we allow the present situation to continue.
I believe that many people in eastern Europe would welcome unilateral action by Britain. That would enable them to bring additional pressures to bear on the Soviet Union to withdraw its forces. Anyone who does not believe the desire of many people in eastern Europe to get rid of Soviet forces should examine the case of Romania.

Mr. Viggers: Will the hon. Gentleman tell us whether the United States has ever perpetrated an act on any country in Europe comparable with the act that Russia perpetrated in Czechoslovakia?

Mr. Newens: I think that the United States has been guilty of perpetrating an act in Vietnam even worse than that which was perpetrated by the Soviet Union on the people in Czechoslovakia. The people of Vietnam are every bit as important, as individuals and human beings, as the people of Czechoslovakia. Therefore. I denounce both the United States and the USSR. I only wish that the same principles would apply amongst Conservative Members.
I believe that we must seek to achieve the withdrawal of all forces from western and eastern Europe to their own countries and the neutralisation of an area separating the Powers concerned. If we allow all the initiative to be taken at summit level we shall be accepting a position in which we have no independence of action ourselves. When we remember what occurred recently at Vladivostok we see that the situation is one in which the super-Powers are making all the decisions between themselves on the development of arms. The countries of western and eastern Europe are acting as though they were members or parts of mere spheres of interest. I believe that the present Government should be prepared to embark on real initiatives to help to bring about mutual force reductions on both sides.
We are now facing an economic crisis which is fraught with great political potential. When we consider the past of Northern Ireland—and Ireland as a whole —we see that the failure to take steps at an appropriate time merely stored up trouble for the present generation. It might be said that dragons' teeth were


sown. In my opinion Britain and the world at large are sowing dragons' teeth. In Britain there are problems gathering momentum in housing, education and welfare. It is clear that we are breeding an even larger and more significant minority of young people who feel alienated from the society in which they are being brought up because they are being denied proper homes, proper education and proper services. We could provide those services if we were prepared to make more far-reaching defence cuts.
Unless we reverse the present tendency we shall be faced with a far greater problem in dealing with our own affairs than anything which threatens us from abroad. The world is going along the wrong road. It seems that we are concerned primarily with the problem of possible aggression and possible war occurring as a result of the Soviet Union's build-up of arms. The real problems of humanity which threaten chaos throughout the world are those of hunger, uncontrolled population explosion and our failure to deal with the demand for development which could provide decent conditions for everyone.
Generations to come will deplore the shortsightedness and the biased concentration by many men, including leading statesmen throughout the world, on military expenditure when we might have used the resources at our disposal to deal with the real problems that mankind is facing. The amendment which was not called sets forth many of the ideas which my hon. Friends and I feel should have come to the fore in the defence review. We are extremely disappointed that they have not. Let us make no mistake about it—the position in the country at large is that the people will not be prepared indefinitely to tolerate ever-increasing expenditure on military ends. Sooner or later this House will have to take note of that attitude and make the sort of cuts which we, below the Gangway, have been demanding for so long.

6.38 p.m.

Mr. Russell Johnston: First, I congratulate the hon. Member for Chichester (Mr. Nelson) on his maiden speech. It was a speech which was well thought out and articulate. On this occasion the hon. Gentleman had the benefit of not being interrupted. Anyone

who blandly says in this House that his constituency is the most beautiful in the country will in future be interrupted on more than one occasion.
It is difficult to argue with the hon. Members for Salford, East (Mr. Allaun) and Harlow (Mr. Newens). They both take fundamentalist views, which I suspect are not capable of influence one way or the other. Essentially, they are not views with which I concur.
The hon. Member for Salford, East has a long and honourable record of supporting pacifism in his party and in the country. I do not condemn him for that, but I and my party do not believe that that is a realistic stance to take at present. Nor do I accept what was said by the hon. Member for Harlow, namely, that he sought to judge the United States and the USSR in an even-handed manner. I do not accept that that is posible. One is a great and massive dictatorship and the other is an incompetent kind of democracy which—I do not dispute this —has perpetrated bad things in parts of the world. But it is an open society. One thing that Watergate has demonstrated clearly and beyond per-adventure is that it is an open society. That would never happen in the USSR. Therefore, I do not think that we should talk about "We in eastern and western Europe", as the hon. Member for Harlow did.
I accept entirely that all of us in the developed countries, whether East or West, spend far too few of our resources on dealing with the problems of the world's hunger and over-population and the other problems that the hon. Member for Harlow rightly emphasised. But it is important to the House and to the country that we stand for freedom and liberty, and that we oppose the kind of brutality and oppression that—let there be no mistake about it—have occurred and are occurring in the Union of Soviet Socialist Republics and its satellites.
Because of the pressure of time, I shall confine myself to four or five observations. The right hon. Member for Worcester (Mr. Walker) rightly asked what was the basis of the review. It appears to be based purely on bringing our ratio of GNP to expenditure on defence into line with that of our NATO allies. The right hon. Member quoted the per capita figures to indicate that


although our GNP is, pro rata, less than that of Germany and the Netherlands, it could be fairly argued that our expenditure on defence per head of the population—which is as good a standard measure as any—is less than that of our main allies. The hon. Member for Edinburgh, Central (Mr. Cook) smiles, but I assure him that that is so.
The per head expenditure on defence in Britain is $155 and the corresponding figures for France and Germany are even higher while in neutral Sweden it rises to $211.

Mr. Robin F. Cook: I had not intended to interrupt, but the hon. Gentleman has almost invited me to do so. Does he regard GNP as an artificial measurement of the industrial and economic activities of the countries concerned? If it is not artificial, but relatively accurate, does he not accept it as a reasonable measurement of the relative amounts that we can afford to spend on defence?

Mr. Johnston: All I am saying is that both measures are dubious. Certainly our GNP now and in the 1980s may be entirely different. That equally goes for per capita expenditure. What I am saying is that the right hon. Gentleman the Secretary of State for Defence has made that the total basis of his defence review, and that seems to be objectionable on economic as well as defence grounds.
There is plainly not the time to deal with each Service in turn, and I should like to take as an example the manpower reductions in the Army. The Army is to be reduced by about 12,000 men. As the right hon. Member for Worcester demonstrated by quotations from Written Answers, it is still unclear where and when the cuts will fall, as presumably they will. On what basis is this reduction to be made? For example, is it on the basis that there is to be a political solution in Northern Ireland? I should have thought that a very germane consideration when considering the size of the Army was one's prognostication of that situation, which is tying up a large part of our forces, and I should like Ministers to give us some idea of their views in that respect—because, let us face it, the situation there could get worse and we might have to commit even more men to it.
Secondly, there is the Soviet threat, on which the hon. Member for Harlow expostulated. Is that now regarded as a weakening threat? The most serious criticism of the defence review, either in the House or outside, is that the northern flank of NATO is being weakened, because the British contribution is to be reduced. One is entitled to ask whether, despite the figures showing that the Russians are producing more submarines, more aircraft and more tanks, we are right to reduce our commitment to NATO, particularly on what may be one of the most exposed parts of the NATO line of confrontation.
On that subject, I also mention the European concept of our defence system. The Liberal Party goes along with the Labour Party view that we must recognise that we can no longer police the world. That, we all have to accept, as we Liberals have accepted it for many years, but I should have thought that the fact that the Government were in the middle of negotiations about our position within the European Community would have some effect on their thinking about our relationships within NATO and towards our European allies.
Standardisation of equipment has so far been too little emphasised. It seems to be the only sensible way, in the long term, to reduce defence expenditure without reducing effectiveness, yet the subject has hardly been mentioned. The Secretary of State said rather more about it today, and listed what we had done already. One hon. Member referred to the cuts in research and development, reputed to be about 10 per cent. Why should we not talk in terms of R and D on a NATO basis, or at least look forward to it, for that would save money without reducing the effectiveness of the R and D in question?
The Government have been reorientating the basis of our defence posture towards Europe, but many people within the Armed Forces themselves still appear to have their thinking oriented towards previous roles. I doubt whether there are more Europeans in the staff colleges now than there were in the 1950s.
I come, thirdly, to the subject of the North Sea. When the statement on the defence review was made, the Secretary of State indicated that a further survey was


being undertaken, but I should have thought that to consider his review adequately we needed a better indication of his attitude on the subject. This is not just a matter of a Soviet threat to the oil installations. Because of their exposed position, the installations are open to sabotage of various kinds. We seem to lack naval vessels of the kind that would be able effectively to protect the installations from such attacks. If they were suddenly subjected to a sabotage attack, there would immediately be a tremendous upheaval, and attempts would be made to improve the situation, but the thing to do is to make that improvement before the attack occurs.
My fourth subject is Polaris. Its future is unclear. I recall the test in the United States, made, I suspect, rather contrary to the holy writ of the Labour Party manifesto. The right hon. Gentleman suggested that Polaris would go on its merry way for 10 years, but we ought to have a clear statement about its future. The Liberal Party has not advocated scrapping Polaris now, but we certainly do not advocate improving it and moving to the next generation, because that would be beyond the country's economic capacity. I should like some indication of what the Minister regards as the period of time after which Polaris will become obsolescent, and what the attitude will be towards that weapon and to the submarines which operate it.
I accept the logic of the withdrawal east of Suez. Despite what the right hon. Member for Worcester said, it is highly debatable whether Simonstown genuinely occupies an important strategic position for this country. Certainly we can no longer for any length of time continue to maintain commitments so far away from our own shores.
I should like to know whether the Government visualise a future commitment to any United Nations peacekeeping forces and whether that is a factor which may have influenced the Government's attitude, for example, towards making available the paratroopers and mobile forces generally.
Reference has been made to consultations within NATO.

Rear-Admiral Morgan-Giles: Before the hon. Member leaves

his point concerning the defence of overseas trade routes, will he say whether it is the policy of the Liberal Party—the great apostles of free trade everywhere— to take no heed whatever of the way in which it should be defended as it passes overseas?

Mr. Johnston: Obviously, no. It would be a foolish apostle who paid no heed to how anything is defended. I said that I thought the view was held by many people that the threat to the South African coast route is not a real one in the event of a medium-term conflict, which we were speaking about. A full-scale conflict would imply a completely different situation, in which, basically, our defence mechanisms would have failed to prevent the war which we would all wish to prevent.
The Opposition amendment suggests that this review imperils the security of the country. That is not a view which we accept. We consider that there are elements which give us cause for concern, but we would find the general direction of the review acceptable.

6.55 p.m.

Mr. James Boyden: The criticism of the Liberal Party spokesman of the Secretary of State's views and actions on the standardisation of weapons is somewhat naïve. The Secretary of State said he was engaged in negotiations with the United States on this matter, and no one can be in a stronger position to do so than the Chairman of the Euro-group.
The United States is well entrenched in the provision of arms to Europe. I am sure that the Secretary of State is right to tackle the problem in the way he has described. I congratulate him on the proposals he has put forward. Considerable economies have been made, and there will be a considerable reduction in the number of people employed.
I regard the civilised treatment of public servants as an essential requirement of a Socialist. The fact that they are soldiers, airmen or people who make tanks does not make them any less qualified to receive careful and humane treatment when they are made redundant.
I was very glad to hear the Secretary of State stress particularly that he plans


to cause the minimum hardship to Service men and people employed in ordnance factories. I would have welcomed a little more information concerning the improvements in the process of the resettlement of Service men when redundancies arise.
Reference was made to the need to provide houses for Service families when Service men leave the Armed Forces. I think that a strong circular should be sent by the Secretary of State for the Environment to local authorities and to the new town corporations asking them to pay special attention to Service men and their families. I speak with considerable experience of the worries of Army men and their families when they come to the end of their engagements and seek new jobs. Not only do they experience difficulty in finding jobs; they experience problems in regard to the education of their children. Most of these ex-Service people are still fairly young, and their children need to continue their education. These people need houses. They experience difficulties in acquiring furniture and other basic goods, apart from the loss of jobs. When this problem arises fairly suddenly or unexpectedly, in the way it will happen now, it will need special attention.
I therefore put it to the Minister that the resettlement courses for ex-Service people need strengthening and improving. Much more thought needs to be given to the equivalence of Service qualifications with those in industry. I know that the trade unions are very good. They accept many trades carried out in the Services as being basically equivalent to those of industry, but greater thought needs to be given to this because there are still anomalies and areas where a Service man with a reasonable qualification is not acceptable in industry. Would the Secretary of State apply his mind to teaching more skills, which would be useful to industry, to the general duties Service men employed in the Air Force, the infantry and the Army, for such people probably have the greatest difficulty in finding employment. I would suspect that the axe falling on the Army will affect the infantry as much as any other body.
I ask very seriously that there should be an increase in the amount of money spent

on the resettlement of Service people who will no longer be needed because of the cuts.
If I could make a suggestion as to where to find money for that purpose, this will only be in the way of saving candle ends but it might help. This is the moment for Ministers to direct Chiefs of Staff to make economies in ceremonies and martial music. I have always felt that there were too many military bands. I have also felt that there were too many central schools of music. From my experience on the Expenditure Committee I discovered that there was such training not for three Services but for four. The Royal Marines had their own ideas of training as well as the three other Services. I have a distinct impression that there are four central schools of music.

Mr. Brotherton: The Royal Navy has no central school of music.

Mr. Boyden: I am very glad to hear that, since it means no doubt that the Royal Marines and the Navy have one school of music between them. There could be a serious argument, since I have made a point concerning the Army, in favour of establishing Kneller Hall as the central school for the Ministry of Defence.
In all senses a further review of the position of Service bands should be undertaken. Economies could be effected there.
I make the same point concerning ceremonial. The Service chiefs will find themselves in a somewhat weak position to make their own economies. They need to experience pressure from Ministers. They are very conscious of the need to maintain morale. They perhaps exaggerate the role played by bands and ceremonial in maintaining morale. Morale is a very subjective matter. I hope that pressure will be applied by Ministers to ensure that serious economies are made. I can suggest some. I have always thought that the Royal Air Force Queen's Colour Squadron was superfluous. I know that the reason for it is that station commanders do not like using their ordinary men for ceremony and display and much prefer to have people trained entirely for the purpose. But it is arguable at least that it might be better to have people on stations taking part in ceremony than people who are not connected with those stations.
As regards the Army, I venture high heresy in that possibly the Royal Horse Artillery Troop in Regent's Park might be dispensed with, and I shall commit high treason by suggesting that the Guards regiments might spend less time on ceremony. Bringing matters down to an operational level, I am sure that the protection of the Sovereign and of London by the Guards is not as effective as the police protection which is given. There could be effective economies in horses, men and operational efficiency in reconsidering this kind of ceremony and tradition, which is ingrained in the Army.

Rear-Admiral Morgan-Giles: Surely the hon. Gentleman is not asking us to believe that he, as an ex-Army Minister, feels that the Guards are used purely for ceremonial duties. Surely the hon. Gentleman is not throwing cold water on the fighting ability of the Guards when it comes to a showdown.

Mr. Boyden: Of course not. It is one of the keys to the success of their ceremonials. I agree that they are amongst the best fighting regiments that there are. But I suggest that they could be relieved of many ceremonial duties with some economy and possibly an increase in their operational efficiency. I may also say to the hon. and gallant Member for Winchester (Rear-Admiral Morgan-Giles) that perhaps the Navy could fire fewer guns in South Africa.
I put this forward as a serious point. It will save only candle ends—it will not save the economy in the way suggested by one of my hon. Friends—but it would have a useful by-product in that it would concentrate the minds of the Services on getting greater military efficiency from their organisations.
At meetings of the WEU and other international bodies which I have attended, I have found that Conservatives generally always push to one side in any consideration of defence any thought of what the Warsaw Pact countries might think of what they are saying about detente and balanced force reductions. My right hon. Friend is right to concentrate on NATO and to regard it as a key bargaining power in terms of force reductions. In a debate of this description, it is essential to continue steadily, as the present Government are doing, to

press in NATO and with the Americans for continuous and better negotiations with the Warsaw Pact for force reductions.
For years in this House I have heard no references made to the Geneva disarmament conference. The Conservative Party tends to write it off. In the past four or five years, it has had some successes as regards chemical warfare, and it may have others in other areas. The very fact that the Geneva conference is in session and is attended by the representatives of a great many nations helps towards ultimate success in achieving balanced force reductions.

Mr. Peter Walker: But if we want to make progress in these negotiations, it is more likely to come if we do not announce reductions unilaterally.

Mr. Boyden: My right hon. Friend has announced slight reductions in NATO, and I remind the right hon. Gentleman that two of my colleagues have attacked him for them. But NATO remains the absolute linchpin of Government policy, and this is a clear and sound argument in relation to the Soviet Union and the Warsaw Pact. In any consideration of reductions in defence expenditure there must be reference to continuous negotiations.
There is one other matter to which I hope my right hon. Friend will direct his mind. He referred to it in passing, as did an Opposition Member. It is the need to look carefully at our reserves in the TAVR. I want especially to refer to the medical branch. The Defence Committee, dealing with medical services, is very disappointed about the time that the Services and the Ministry of Defence have taken to implement the Jarrett Report. It was published some time ago. Progress in rationalising the hospital service for the Services and in making changes in medical training and the training of nurses has been going far too slowly.
I throw into this pool the need to consider the position of doctors on the Reserve and the need to widen the reserve of doctors for BAOR. It is a serious weakness in our Services in NATO that we are short of doctors and that we do not have a sufficient reserve of medical staff. In my days in the Ministry of Defence, bandsmen were remustered as partial medical assistants, but that was


not quite enough. Therefore, I urge my right hon. Friend to look into the state of our medical services since they are so vital for the morale of Service people and for NATO.
Considerable economies are being made. There will be considerable redundancies. The fact that my right hon. Friend is proposing to take this gradually and carefully is a tribute to the defence review and not a criticism of it.

7.6 p.m.

Mr. David Walder: Taking up one point made by the hon. Member for Bishop Auckland (Mr. Boyden), perhaps I may quote Kipling. Part of the hon. Gentleman's discourse was devoted to the principle,
'Thank you, Mr. Atkins,' when the band begins to play.
I agree, and I do not cross swords with much of the rest of the hon. Gentleman's speech.
It is a pity that, rather like the captains and the kings, the hon. Member for Harlow (Mr. Newens) has left us. In my innocence and simplicity, I had thought that those hon. Members who favoured his amendment, rather in the terms of that excellent book, "1066 and All That", had hitherto thought of the USSR and its position in eastern Europe as a good thing. However, I was surprised to discover that the hon. Gentleman and his hon. Friends do not think that. In my view, therefore, any basis for their argument disappears, and what they say is completely without validity. I am mystified. For that reason, I shall deal not with the band but with Mr. Atkins.
Whenever we discuss defence in this House, there is disagreement between the Conservative and Labour Parties. In a previous defence debate, I can remember the Minister of State saying, with obvious sincerity, that in the heart of every Socialist there was a pacifist. I feel that that is something of a luxury, because pacifists enjoy a society which is preserved and defended by men and women who are not pacifists.
I accept that a nation has to gear its defence expenditure to the state of its own economy and to what it can bear, especially in a democracy. However, I

am sure that Mr. Brezhnev's reported aside to the French that one in three roubles is spent on defence is not one which we would think either desirable or possible in the Western world. I accept also that a nation can be destroyed economically as well as militarily.
Throughout the two debates on defence and the defence review, so far, the Secretary of State has banged away at the theme that NATO is the linchpin of our defence posture. I agree with that. I sometimes wonder how some Labour Members regard that. I sometimes get the impression that they do not take the view that we and the Secretary of State take—that NATO is essentially a defensive alliance. They do not seem to share our occasional puzzlement over attempts to make the NATO organisation and the Warsaw Pact appear equal when NATO's actions throughout have been defensive. With the Warsaw Pact we have seen the situation in Czechoslovakia and in Hungary. We notice how the Soviet Union is immediately alerted when there is a crisis in the Middle East, if there are NATO exercises in the North Sea, or if there seems to be a crisis of some sort brewing in the Mediterranean.
Can we really think that this interest displayed by the Soviets is for peaceful purposes—for purposes beneficial to ourselves in the West, or ourselves in this country? I would hardly have thought so. One would have to be very innocent to believe that.
I can see that it is militarily logical to maintain the Western alliance but I would have thought it rather naive to argue that by reducing the capability on the two flanks of NATO we thus increase the capability on the central front. That, as I understand it, is the Secretary of State's argument. There is also an overall reduction in manpower. Disarmament and detente are in the air. But detente will be achieved only by tough, close bargaining. To begin that bargaining by throwing away a principal card, face upwards, without any compensatory advantage is, to my mind, foolishness. We are unilaterally reducing our defence potential, not on military grounds but on monetary grounds.
So much for NATO. Logically and militarily it is possible to make a case for reducing our global commitments. The


Secretary of State talked about our giving up the Imperial role. That was given up many years ago. It is curious that although the right hon. Gentleman talks in those terms he has not done that. There are still forces seemingly to be distributed over the globe in penny packets. RAF Transport Command will be halved. I do not know how we shall communicate with the penny packets, or how we shall ever reinforce them. It seems almost impossible.
Not only does the Secretary of State propose to reduce the possibility of reinforcement but at the same time he is to reduce the credibility of the forces on the ground, unless we imagine him running round, possibly at night, trying to arrange in an emergency, to fix up transport with the charter airlines. There is a case for cutting global commitments, and in those circumstances we have to make up our minds what sort of war we are likely to wage. The catch is that this is not always within our power or choice.
How many Members of this House 10 years ago would have predicted the current situation in Northern Ireland? Yet by this review we are cutting the Army by 12,000 men—the equivalent of two brigades or 10 major units. This must inevitably mean that our Army is overstretched, even beyond its present tasks. It must mean more tours for regiments and units in Ireland. I was in Ireland just before the election. I saw deployed there an infantry regiment, a Sapper regiment acting as infantry and a Gunner regiment acting as infantry. If we take 10 major units out of the Army List we shall inevitably exacerbate that sort of situation.
We reduce numbers overall by this defence review. Inevitably, mobility will become difficult and reinforcement unlikely. We are told that there will be consultation with our allies. I would be expressing the view held on the Conservative benches if I said that we are still uneasy. What is this consultation to be? Will it really be argument with our Allies and consultation with them? Will we know their views? Will we have any indication that all the 13 nations in NATO agree, or are they to be presented with a fait accompli and are we to get the results returned to us as the Secretary of State has sketched out in his review?

If it is not to be meaningful consultation with our allies it would be better if the right hon. Gentleman were honest with us and did not go through such bogus manoeuvres.
We all know NATO's faults. One is a lack of standardisation. Another has been pointed out in recent weeks by Sir Peter Hill-Norton. We know the defects of NATO. We know that militarily NATO forces look less credible and less effective than Warsaw Pact forces. They lack the cohesion of the Soviet forces. Yet within NATO we, the British, are regarded as the professionals, the trained experts with an all-Regular force. That primacy is bought at a price. It is bought at the price of active Service experience, sometimes in other parts of the globe but also in Northern Ireland.
It is also bought at a financial price. All-Regular forces are more expensive than conscript forces. Sometimes our European allies expect too much. Sometimes there is a suggestion that the British should continue to garrison various parts of the world, such as the Far East and the Middle East. I have heard this suggestion from German and French politicians who, putting it in a simple way, say that we should stay in the Middle East to help preserve the supplies of oil to Europe. That may be well and good. I have sometimes suggested that Europeans, too, should take an interest. I have never received any takers for that.
A great deal of the cost of our forces is taken up in pay and accommodation. Those Labour Members who support the amendment in the name of the hon. Member for Harlow seem entirely to have left the Chamber, so I cannot address them. I am always intrigued by the arguments which try to show that most defence expenditure is upon equipment and the like. The mass of it is on pay and accommodation. Kipling once talked about
single men in barricks, most remarkable like you.
The trouble is that they are no longer single. There are more women and children in BAOR and RAF Germany than there are Service men. Our most modern comprehensive school for British children is in Cyprus. If money is their sole consideration, those who wish to see Polaris submarines and the like disappear


—the Left wing of the Labour Party— might do better to concentrate their attention on the many schoolteachers, social workers and NAAFI managers who are involved.
No one, certainly among the Labour Party, would advocate a conscript service even if it could be done on the cheap. No one would suggest that the British Service man should not enjoy the same facilities as his brother in industry. We must recognise that to provide Regular forces with all that they and their wives and families expect today is a costly process and is likely to become more so.
I have already suggested that our forces, with the proposed manpower reductions, are bound to be over-strained. There will be fewer facilities for training abroad. There will be fewer inducements for young men and women to go into the forces. There will be less travel and less adventure training. The promotion triangle, whether for officers or men, will be more acute. The career prospects will be dimmed. No parent, looking at the present defence review, would say to a son or daughter, "There is a marvellous career for you". The Secretary of State has said that the Government will embark on a great recruiting drive next year. Speech fails me. What a wonderful time to choose!
All those factors are relevant to providing Regular forces. A heavier burden will be placed on the shoulders of Service men and, perhaps more important, on their families. At the same time, the credibility of our forces will be reduced. It is vital that it should be preserved to deter potential enemies, and it is very important internally. The Service man has his pride. It is important that he should think that the forces are credible, important and worth while.
If we are to believe all that we are told, the Secretary of State—I never doubt his patriotism—has fought a battle with his Cabinet colleagues over this review and undoubtedly with the Left wing of his party. I do not think that the review contains much military logic. On the basis of the appearance of short monetary gains, and sometimes not even that, a curious situation has been produced. I know that the South Africans and probably the Sultan of Bahrein

occupy a position in what I might call the demonology of the Labour Party. They remain there. But in the same breath the Saudi Arabians seem to have gone into its hagiology. This I find difficult to reconcile. However, I give the Secretary of State credit. He has fought a battle. Sadly, I think that he has lost it, but, I still hope, not irretrievably.

7.23 p.m.

Mr. Roderick MacFarquhar: May I first establish my credentials in the only way which is apparently acceptable to the Opposition. I was recently criticised personally in the Soviet Press —not, it is true, in Pravda, but in lsvestia. Therefore, although hon. Members opposite may disagree with some of the things that I say, I hope that they will not impugn my motives in the unfortunate manner in which the right hon. Member for Worcester (Mr. Walker) dealt with my hon. Friend the Member for Harlow (Mr. Newens).
I wish to make two points. The first concerns the question of the Indian Ocean on which the Opposition give vent to much sound and fury. The essence of the argument as stated by the right hon. Member for Worcester when commenting on my right hon. Friend's far-reaching and generally praiseworthy review 10 days ago was that 2,000 British ships use the Cape Route every year, that 1 million tons of oil pass over that route each day, and that in the last two years Soviet naval strength has quadrupled in the area.
Let me deal first with the question of the ships round the Cape. There is a problem here. A constituent of mine, a sailor, has written to me about how his ship has often been followed by Soviet naval vessels—an unpleasant nuisance, certainly, but is it much more than that? If we have not been able to prevent it in the past, as clearly we have not, I cannot see what difference maintaining a naval presence in that area will make in future. Besides, Soviet ships constantly monitor and follow our NATO task forces when they are engaged in manoeuvres, and there is nothing we can do about it.
The difficulty about the Opposition's stand on the Indian Ocean issue is that two facts, the number of British trading vessels rounding the Cape, and the size


of the Russian fleet, are juxtaposed in a menacing way without any clear indication of precisely what scenario is feared. I am glad that the hon. Member for Clitheroe (Mr. Walder) mentioned the need to anticipate what form a conflict might take. I should like briefly to anticipate one or two possible scenarios which may be in the hon. Gentleman's mind.
Are the Soviet vessels going to halt British commerce in time of peace? I suggest not. There has been only one serious blockade of that type since the war, when the Americans prevented Soviet ships from carrying rockets into Cuba. It was done only because the United States felt that there was a grave threat to United States security—something which the Russians are hardly likely to feel about British commercial vessels rounding the Cape.
Might the Soviet Navy try to cut oft British and Western European oil supplies to bring Europe to its knees? Does anyone seriously believe that if the Soviet Union were going to risk a worldwide conflagration—that is precisely what such a move would entail—it would adopt a course of action which would alert the West, give us time to co-ordinate our strategy and lose Moscow any hope of surprise in the vital area, central Europe?
What about war time? I cannot believe that there are many hon. Members who think that a third world war would repeat the patterns of the First and Second World Wars, long-drawn-out struggles in which the preservation of open sea lanes for years on end was a strategic necessity. Most hon. Members would admit that the likelihood is that a third world war would in practice last less time than it takes an oil tanker to get from the Persian Gulf to a British port.

Mr. Patrick Wall: Can the hon. Gentleman explain why oil must come to this country round the Cape? It has to be defended somehow. Why is the Soviet Union spending so much money on its navy when it is already probably the biggest nuclear Power in the world? If it is in a position to blackmail the West by saying "Unless you do as we say we shall stop your submarines", that is all it wants. Is not that the reason behind its immense expenditure on naval arms?

Mr. MacFarquhar: I have answered that in part by suggesting that the Soviet Union would be unlikely to be so silly as to attempt that kind of confrontation, because then, in the central sphere, the NATO area, we would be alerted and it would fear a response there. I shall return to that point later.
For the sake of argument—the Opposition's argument—let us consider that most vital cargo which comes round the Cape, oil. The right hon. Member for Worcester mentioned 10 days ago that it amounted to 1 million tons a day, and that is 365 million tons a year. Of course, not all of it goes to the United Kingdom. In 1973, we imported over 82 million tons from Iran and the Middle East. The other 280 million tons went elsewhere, including 54½ million tons for Germany and 92 million tons for France. Clearly both countries, as well as other smaller European countries which I have not mentioned, are heavily dependent on oil supplies from round the Cape. What naval precautions do they take to protect those supplies?
The latest edition of the military balance issued by the Institute for Strategic Studies shows that while the United Kingdom boasts 74 major surface combat vessels and 30 non-strategic submarines— that is, submarines not connected with the nuclear deterrent—France has only 49 major surface combat vessels and 19 ordinary submarines, and Germany has 22 surface vessels and 13 coastal submarines. France maintains an Indian Ocean presence, but not even the most Gaullist admiral could claim that it would do much to protect French shipping in war time, while the Germans plainly maintain a basically coastal fleet for Baltic purposes. Does anyone in the Bundestag, on the Right, on the Left or in the Centre, thunder about the need to build a new high seas fleet to protect those vital German oil supplies? Of course not.
If that is because Germany and other European allies believe that we, the British, can stand guard for them and that a British naval presence is desirable in the Indian Ocean area, it is about time that this should be accepted as a European responsibility and not just a British responsibility, and we should be subsidised for performing this role when their stake is as great as ours.

Rear-Admiral Morgan-Giles: I am very grateful—

Mr. Speaker: Order. This is the third time that the hon. and gallant Member for Winchester (Rear-Admiral Morgan-Giles) has interrupted in an hour. It is rather unfair on other hon. Members who wish to speak.

Mr. MacFarquhar: I had better get on with it.

Rear-Admiral Morgan-Giles: On a point of order, Mr. Speaker. Is there a limitation on interventions in a debate?

Mr. Speaker: It is just a question of selfishness, and whether another hon. Member will be unable to get in to make his speech.

Mr. MacFarquhar: I do not believe that that is the reason for the absence of other European fleets from the Indian Ocean. The real reason is that the other ex-imperial Powers have given up their memories of grandeur more expeditiously than we have. They have translated the concept of being purely European Powers into practical terms. The sooner we do the same the better, and I applaud my right hon. Friend's decision to complete the withdrawal from east of Suez. If the Russians and Americans wish to play at super-Power politics by showing the flag in the Indian Ocean, let them incur the expense and the odium of the littoral Powers for so doing. I only ask my right hon. Friend whether he has any intention of continuing to show the flag in the Indian Ocean and, if so, in what strength, how often and, most importantly, why?
My second, briefer, point has to do with the nature of the manpower cuts. My right hon. Friend will doubtless remember that the scientific basis for Parkinson's Law lay in naval statistics for the first quarter of this century, which proved that while ships declined in number Admiralty and dockyard officials increased enormously in number. I trust that my right hon. Friend is aware that in the period of office of his Conservative predecessor there was an alarming variation of this law. Between 1970–71 and 1973–74 the number of Service personnel in the Royal Navy declined by 18 per cent. but, while the staff of the Whitehall headquarters of the Ministry of Defence declined too, it declined only by half as

much, 9 per cent. I should like to know the reason for that.
Even more disturbing is another statistic. According to the Economist of 7th December Britain currently has one general or his equivalent for only 545 Service men. The comparative figures are, for Germany, one per 1,800, France, one per 1,400, and the United States, one per 2,000.
When I looked into the Army figures over a period I was even more disturbed. At the end of 1964 Britain employed one general to 393 other ranks, that is about half a battalion. By September 1974 the figure had improved marginally to one general to 403 other ranks. Those figures are for brigadiers and above. The figures for major-generals and above are somewhat more reassuring, but going the wrong way. It is the earlier comparative statistics that are dismaying.
We hear a great deal about the professionalism of our all volunteer Army and I am sure that that is, by and large, true, but comparative statistics of this type have a somewhat Ruritanian flavour. Will my right hon. Friend explain why we need so many generals, relatively speaking, as compared with our closest allies? Will he tell the House what measures he will be taking in reshaping our Armed Forces to ensure that they truly resemble the British bulldog—lots of teeth and little tail?

7.33 p.m.

Mr. Hugh Fraser: I am glad that the hon. Member for Belper (Mr. MacFarquhar) raised the question of manpower. I approach it in a rather more serious way than perhaps he did. What the House and our allies have to realise is that eventually the strength of the country and its armed forces is largely judged by the number of reserve troops and the number of men who can actualy be put in the field.
Both Government and Opposition over the last few years have witnessed a dangerous decline in the amount of military—by which I mean Army—manpower that is available. The right hon. Gentleman announced a cut in military manpower which, if taken with the cut in the Commandos and the Royal Air Force Regiment means that about 15,000 men are being cut out of the front line, although we have a civil war in Ireland


and a large number of commitments outside Europe.
Even more alarming, reserve manpower has fallen from June of last year by 75 per cent. with the ending of the Army General Reserve. The main problem in any military planning is facing the unknown and totally unexpected events which occur. Northern Ireland is one such event. The Korean war, our involvement in Malaya and our involvement in Africa are three other recent examples.
Within the last 18 months, whether it be the fault of the Government or of events, the reserve forces available on the ground have fallen from about 360,000 to fewer than 100,000 men. That is an alarming figure. Dr. Luns is reported today as being somewhat distressed by the Government's review. That must have been one of the figures which he took into consideration.
May I explain how the other European countries stand with reserve forces? I am referring not to air reserve forces but military, on the ground, reserve forces. France has 450,000 reservists available— in a week ; Germany has 450,000 reservists ; Bulgaria has 250,000, although the less reliable members of the Eastern bloc are allowed fewer, and Hungary has only 40,000. This country now has fewer than 100,000 men able to come forward. If one looks at commitments outside Europe, Europe has far larger standing armies than we have. I consider that the question of the reserves and what can be done about them is alarming.
I was pleased to hear the right hon. Gentleman say this afternoon that he was to have a recruiting drive for the TAVR. There are only two reserves in existence today. First, there is the Regular Army Reserve, which is under 60,000, of which only section A is of immediate use. The number in section A can be worked out roughly by dividing the Regular Army Reserve by three, which gives 20,000. Secondly, there is the Territorial Army, whose strength has fallen by about 10,000 since 1972. Those are the reserves available to meet every sort of condition outlined, whether it be from the Left or the Right, with world conditions becoming more turbulent and more dangerous every day. That is the

most serious problem with which our Armed Forces are faced.
I hope that the Minister who is to reply will tell us about the size of the age groupings of the Regular Army Reserve. When we had a three-year term of service, which is now becoming unfashionable, the age of the Regular Army Reserve was comparatively low. I suspect that now, with a longer term of service, the age of the Regular Army Reserve has become very much higher.
We have this fixed number of regular reservists which will decrease because the size of the Armed Forces will decrease. It will be a diminishing entity. We are left with the only other form of reserve available to the country, which is the TAVR—the Territorial Army. It is regarding this that I would like to make various suggestions.
I say to the whole House, to hon. Members on both sides, that we shall be judged by the number of reserve soldiers we can put in the field. Unless we can show an infinitely greater number than we have today, this House will be faced with the re-introduction of conscription in the not far distant future. That is an ugly thought, and is probably not acceptable to either Front Bench. A catastrophic fall has inevitably followed from the ending of conscription, at the time of which the Army General Reserve average age must have been about 37. We are faced with the fact that we have not at the moment anything like a sufficiency of soldiers to put on the ground, to protect various interests to which we are committed, and to deal with problems here at home. Therefore, so far as the Territorial Army is concerned, we must look at this much more seriously than merely thinking in terms of a recruiting drive.
In 1967, when the last major reform of the Territorial Army was carried out, its recruited strength was 115,000. The present Chancellor of the Exchequer then reduced the strength of the establishment to 55,000. Two years ago a Conservative Secretary of State for Defence pushed it up again to 65,000. Overall the strength of the force is 74,000, including various people who do the training of cadet battalions, and so forth. Of this figure of 74,000, about 54,000 are recruited.
The first step towards trying to build up a proper reserve in this country must be to bring the TA up to establishment. To bring the figure up from 54,000 to 74,000—or whatever the precise figure may be—will take a lot of doing, and three things are essential in this respect. First, there needs to be a statement not only by the Secretary of State but also perhaps by the Prime Minister, and by my right hon. Friend the Leader of the Opposition, in which they can make clear how important they believe the TA to be. There is undoubtedly a collapse of morale. I had to reorganise the TA back in 1960. It has had too many reorganisations. The TA wants to be put put on a firm basis, and to be told more precisely what its role is. That is of vital importance.
Secondly, there is the importance of increasing the bounty. It has remained without any improvement since 1957, and must be increased. These men give up a lot. They have a fortnight in camp, and undertake a large number of drills throughout the year.
Beyond that, the next stage, once recruiting has been achieved, is that the powers-that-be must seriously consider a considerable increase in the strength and size of the Territorial Army above the present figure of 74,000. When a former Labour Secretary of State reduced the size of the Territorial Army he also reduced the number of drill halls. Out of a total of 1,200, 800 were disposed of. In addition, a considerable number of specialist battalions — the docker battalion, the transport battalion and the railway battalion—were largely cut. Recruitment of a sufficiency of reserve forces must depend on going to where the men are available. This is in the rural areas, where the drill halls are gone, and in the industrial areas, where there has been a diminution of what are now called, I think, the sponsored forces. A considerable increase could be made in this.
I turn finally to finance. The Secretary of State is keen to save money. We must accept that as expenditure on new weapons goes up by a geometrical rate, we shall probably be able to afford fewer. But we must be prepared to see that we are protected by a sufficiency of armed men. That, at the end of the

day, is what matters. There is an example on costings that we can consider here. As hon. Members will know, on mobilisation one-third of BAOR consists of TAVR reinforcements. That is a pretty alarming thought, but that is how BAOR is brought up to strength, and the cost of the TAVR contribution of one third is 4 per cent. of the Army budget.
If hon. Gentlemen wish to see the defence of this country undertaken not at immense expense but on the cheap they should note my belief that we have a great chance to build up this force so that we have a proper reserve. In this respect we are unlike European countries, with their enormous reserves, and unlike Israel, which can mobilise 275,000 men within 30 hours. We have a reserve of 100,000 men, and yet we have civil war in one of our main provinces. Not a single country in Europe has this sort of trouble. Nor do those countries have commitments outside Europe, but we have commitments in Oman, Singapore and the Far East, and we also have potential commitments. It is no good hon. Members opposite shaking their heads. Hon. Gentlemen on the Government side talk of their responsibility to decide the fate of Rhodesia. It is no good saying that we have not a responsibility. We have a responsibility, yet we have behind us at the moment 100,000 reserve soldiers, and this is not nearly good enough.
Perhaps both Front Benches have not paid enough attention to this point. Now is the time, before it is too late, to recruit and build up a citizen force, within the framework of the British Army.

The Deputy Speaker (Sir Myer Galpern): Before I call the next hon. Member, I draw attention to the fact, as Mr. Speaker has probably done, that there is a lengthy list of hon. Members who wish to take part in the debate. The number now stands at 23. I am sure that hon. Members can work out for themselves the best method for the Chair to be able to call as many hon. Members as possible.

7.49 p.m.

Mr. Alec Woodall: I promise, Mr. Deputy Speaker, that I shall be as brief as possible.
I have spent most of my life in a Yorkshire mining community, and so in


contributing to the debate I cannot follow the remarks of the right hon. Member for Stafford and Stone (Mr. Fraser). Nor do I speak from close study of high strategy or from a detailed technical knowledge of the modern weapons of war. As the right hon. Member for Bridlington (Mr. Wood) can confirm, I was his platoon corporal in the last war, in 1940, when it was my job to instruct him in the use of the infantry weapons of that time— the Bren gun, the rifle and bayonet, and the grenade. They were hardly sophisticated weapons by today's standards, judging from the literature produced in the recruitment campaign.
I welcome the proposals made by my right hon. Friend the Secretary of State, both on 3rd December and as further outlined today. He had a difficult task. He could not please everyone, and indeed, he appears to have pleased very-few, but I think that he has got it about right.
As a trade unionist, and now as a Member of Parliament, I value the freedoms that we all take for granted—the right to organise, the freedom of speech, the right to strike. I was a miner on strike last February. Those are precious things that people in many parts of the world do not have. They are worth fighting for, even if we go down fighting.
Some of my hon. Friends are pacifists. I wholly respect their views. After my experiences in the last war I, like many thousands, was hopeful that never again would the world see arms taken up, but my experience in life suggests that we cannot expect our enemy to lay down his arms just because we have done so. The Labour movement, to which I belong, believes in disarmament, but of a multilateral kind. We support the United Nations, just as years ago we supported the League of Nations, but till all the major countries of the world are prepared to join in the ending of the arms race we must be prepared to defend ourselves and our freedoms.
That is why I am worried about those who believe that we can save on defence larger and larger sums, without considering the consequences. I do not believe that there will be a war tomorrow, but I believe that to reduce our defences

beyond a certain point could provoke those who would like ultimately to destroy our freedom to argue in the way that we are arguing now.
During the past 10 months we have had two General Elections in which we pledged to cut arms expenditure to a figure somewhere in line with that of our European partners. We have worked out how to do it, and now we shall honour that pledge. Having grown up in a mining community, I am fully aware of the economic and social needs of ray constituents. Unless we can solve the balance of payments problem and check inflation their standards of living will suffer. In addition, we need more money for homes, schools and hospitals.
If we do not improve standards of living our people will become disillusioned, just as some of my constituents were disillusioned during the 1960s because of pit closures and their effects. In the end our system, which has been stable, could collapse. If we are concerned only with defending ourselves against the external enemy we could betray the hopes and aspirations of those we are defending. That is why it is a matter of judgment how much we can cut defence spending. It is a matter of fact that we could realistically make savings only in projects which we inherited. The cost of cancellations could be astronomic and the unemployment prospects devastating. This is why I think that my right hon. Friend the Secretary of State has struck the right balance in a very satisfactory way. I hope that he will now take particular care in the consultations he will be having to minimise the employment consequences of his defence review.
I say to some of my hon. Friends that we cannot have it both ways. If we are to save money on equipment, some job will be lost, but I hope that everything will be done to bring civil work to areas where military work declines. I hope that my right hon. Friend will remember in particular the needs of those areas, especially in the North, where industrial decline is a continuing problem. I welcome what my right hon. Friend has said in the debate, as I welcomed his statement. The great majority of the British people are behind him in carrying out his difficult task.

7.54 p.m.

Mr. Neville Trotter: It is well known that the Government's attitude to defence was decided long before the defence review began. To use a medical term, I think that the instructions were to give the patient not a check-up but surgery. The Secretary of State for Defence has carried out those orders.
In his statement of 3rd December, the right hon. Gentleman referred to the various factors to be taken into account. I would refer to a similar statement by Admiral Gorshkov, head of the Soviet Navy, who has been at the head of that modern and expanding force for some 20 years. He has said:
The condition of the economy determines the power of that most important weapon of poicy, the armed forces of a country, whose condition is a reflection of the economic might of the State.
There is a great deal of truth in that. It is what has been said by Labour Members. But another factor has been left out of account—the political will of the leadership of a country to maintain adequate defences. That will is sadly lacking on the part of our Government.
The Secretary of State said on 3rd December that producing the defence review had been a tortuous exercise. I can well believe that it was very tortuous, bearing in mind the views expressed by so many of his colleagues behind him.
When visiting the Soviet Union, one cannot but be struck by the low standard of living. Yet that country, with a standard of living only a fraction of our own, continually spends more and more in real terms on armaments, largely of an offensive nature. The burden is all the heavier because of the low living standards of the ordinary people. Why then, do their leaders choose to spend money on tanks, not cars; on fighters, not holiday flights to the sun; on missiles, not houses; on submarines, not shops?
We can readily understand why the people accept the burden. They are better off than they have ever been, and they genuinely fear attack, because they are told by the propaganda machine that it is a real danger. They are ignorant of what they are missing in the way of living standards and of the true wishes of the people of the West, who want nothing more than to leave them in peace.
But why do the leaders, the hard-headed realists in the Kremlin, impose

this burden on their people? They know full well that there is no intention in the West of attacking the Soviet Union, yet they have built up a great capability for war. We must consider their intentions. It would be folly not to. At present they talk of detente, but what do they do? They constantly increase both the quantity and quality of their armaments, and the gap between the West and the Soviet Union is constantly widening.
On 3rd December the Minister made great play of the fact that in the Warsaw Pact 85 per cent, of the strength were conscripts. I reply with two other facts. First, one can do more for one's money with conscripts. Secondly, and perhaps even more important, the army of Nazi Germany was also composed of conscripts, and that did not stop it over-running Europe in 1940.
I do not believe for a moment that at present the Soviet leaders wish to engage in an act of outright military aggression. They prefer to obtain their way by pressure and subversion. But if we allow the gap between us to widen too far there will be a process of intimidation. We shall encourage aggression. There will be a danger of a fait accompli, of aggression by incident and by accident.
The whole basis of the review is fallacious. It is fallacious to refer to the gross national product of our allies and their spending on defence. In 1954 we spent 10 per cent, of our GNP on defence. In 1964 defence spending was down to 6·7 per cent. This year it is 5·5 per cent. Now we are told that it is going down to 4·5 per cent.
It is interesting to note that in 1954 the expenditure amounted to about one-quarter of total public spending. Now it is down to only one-tenth. Has the world been any safer in the last 20 years, or, indeed, in the last 10? In fact, in the last 10 years, the world has become very much more unstable than it was.
We do not spend less on education or social services, nor propose to do so, just because our friends and allies are growing wealthier than we are. We should equally not accept that we must spend less on defence which is a first essential. The most important assurance the right hon. Gentleman could give today would be that there will be no further cuts during the period of the review on future


grounds that the percentage of the gross national product spent by our allies has become greater than ours simply because they have again grown faster than we have.
It is sobering to think that this country spends more on drink and tobacco than on defence. We are spending about 50 per cent, more on booze and baccy than we do on defence. With those figures, I do not accept that we cannot afford to maintain an adequate level of defence.
The Secretary of State has said that the waters of the eastern Atlantic are crucial, and that is true. But does not he accept that equally crucial is the Cape route. Eighty per cent, of Europe's oil and 50 per cent, of its raw materials come along that route. There is a ship every 25 miles strung out over the thousands of miles between the Cape and British ports. I shall not enter into an argument about South Africa. Many things there do not appeal to me. But it is a fact of life that Simonstown is the only base with adequate facilities on this vital sea route.
My right hon. Friend the Member for Worcester (Mr. Walker) has reminded us of the evasiveness of the answers to the many Questions that we have put down about defence. Today I did obtain an answer which was more definite. I asked whether there ware any dry dock or dockyard facilities at Diego Garcia, and, if not, whether it was proposed to construct any. The Minister, in reply, said that there were no dry docks or dockyard facilities there and that there would be a modest expansion of the facilities for the United States Navy, including an improved anchorage and ship support facilities. He added that there were no plans for a dry dock. This is wholly inadequate as an alternative to the excellent facilities at Simonstown.
Yet the Soviet navy is increasing rapidly and is now a most formidable and modern force. The "Ark Royal" is now being phased out. When it is to go is a secret, and we must not be told, apparently— but I hazard a guess that the "Ark Royal" will go at about the same time as the first proper Soviet aircraft carrier takes to the high seas. It is an ironical situation. It might be fitting for the Minister to arrange for a photograph to be taken of the two ships passing each other—the "Ark Royal" going to the

scrapyard and the "Kiev ", or whatever it may be called, proceeding to the high seas.
The United Kingdom is particularly vulnerable to attack on its sea lanes. I do not agree that because our NATO allies have devoted their resources to land armies rather than to their navies it is an excuse for our not providing adequate naval forces. If the hon. Member for Belper (Mr. MacFarquhar) would delve further into his statistics he would find that the armies of France and Germany are much bigger than our own, but that, instead, we have concentrated—understandably, in view of our tradition, geographical situation and pattern of trade— on the Royal Navy.
I turn now to the effect of the cuts on the shipyards, particularly the civilian yards. There was an awkward political problem of how to keep open the four naval dockyards as the Navy's ships are to be reduced greatly in number. We are told that the solution is for the naval dockyards to have moved into them work which is at present carried out in civilian yards. But all that this will mean is shifting unemployment from Portsmouth and Chatham to the North-East and Scotland. That is neither desirable not creditable. However, it fulfils promises made by the Government during the General Election—promises made in Portsmouth and Chatham, but certainly not made on Tyneside, which will suffer seriously as a result of this move.
The NATO flanks are particularly weak. We are not just talking about the Arctic wastes of Norway, important as they are to those who think deeply about the implications of a possible conflict. Nor are we talking just about the mountains of Thrace. We are also talking of the Baltic, because it is one of the flanks just as much as are the north of Norway and Thrace.
Today, there has been a NATO communiqué about the situation in the Mediterranean. It refers to the instability there as causing grave disquiet, and adds that there is need for special vigilance in that part of the world. How are we to react? We are to bring home our planes, our ships and our commandos, reduce our naval capabilities, withdraw from Malta, and cut our forces in Cyprus.
The defence review has been described as the most extensive and thorough in peacetime. One intriguing aspect is that there appears to be not one single direction in which it has been found desirable or necessary, as a result of the review, to increase the strength of our forces. That is surely a tremendous tribute to the last Conservative Government. It is amazing that there is nothing at all that requires strengthening after this searching review.
The details of the review are vague. It seems that they have not yet been worked out. My right hon. Friend mentioned the sort of answer we have been getting—" not in a position to say", "under review", "the implications are still under consideration", "too soon to say", or, simply, "cannot say". However, there have been two exceptions. I have been informed, in reply to questions, that the University Air Squadrons will continue and we shall not be giving up the sovereign base a Dekhelia. But, in considering the detail, how can the Secretory of State impose a cut of 12,000 men in the Army without knowing what sort of units will be disbanded? How can he say that after the cuts we shall have an Army of optimum strength?
The Secretary of State has left two particular mysteries. Those of us who listened to him today are none the wiser about why the Government are getting rid of a battalion of Gurkhas. There has been no explanation. Why are we coming out of Brunei? There has been no explanation of that. It costs us nothing to be there. We do not even know how many Gurkhas the Government are getting rid of. That, we are told, has also not yet been decided.
The second mystery concerns the Parachute Regiment. May we be assured that it will continue? Why the mystery? If it is to continue, why not say so? In the last 10 years, nine out of 10 of the exercises in which the regiment has taken part abroad have been in Germany or Denmark. It has not been in the habit of going to far distant places. It has been in the centre of Europe.
I have a suspicion that after the internal dogfight in the Labour Party a total was arbitrarily arrived at, and that total was shared out between each Service

in about the same percentages as they are now getting. I shall table a Question on this point, as I wish to be enlightened, but no doubt I shall get an evasive answer. I suggest that the Army, because it retains a lot of men, is to have cuts made in its equipment; that the RAF, because it is to have much new equipment, is to have large cuts in the number of men; while the Royal Navy is to end up with smaller cuts in the number of men and larger cuts in the number of ships. There has been no explanation of the way in which the fundamental balance between the three Services and their cuts has been arrived at, while the details seem to be largely undecided.
This review will be more welcome in the Kremlin than in the capitals of our allies.
There have been protestations that the consultations with allies will be genuine but I fear that in fact they will be much more of a charade. I wonder about Brunei. If the Government of Bruei and our other allies in that area wish the Gurkha battalion to remain at their expense, will it be allowed to do so? I suggest to the House that if we had maintained our modest presence in the Persian Gulf, at the expense of the local State, instead of having it removed by a previous Socialist Defence Minister, we may not have seen the development of the oil crisis to the present extent.
I suggest that we might well set up a Select Committee of the House to consider the future of the Armed Services following the example of the Dutch Government. All the options could be considered. We have not been told what the options are. After considering the opinions of our allies and after open discussion the Committee could put forward its proposals on this matter of great importance.

8.11 p.m.

Mr. Alan Lee Williams: I think that the way in which my right hon. Friend produced his statement in December, the way in which he is now going through the process of consultation and the manner in which he spoke this afternoon ensure a certain flexibility. I welcome this because it means that he will be taking into consideration many of the points that have been mentioaed not only during the debate today but in consultation with our allies.
I do not share the criticism of the right hon. Member for Worcester (Mr. Walker) and the hon. Member for Tyne-mouth (Mr. Trotter) that the review is not cut and dried. I particularly welcome the fact that it is not cut and dried and that we are in a position, as the House should be, to make our points and suggestions. The situation is unique, because normally the House is presented with a White Paper and everything is decided, and the debate is just a formality. On this occasion, I feel that there is genuine consultation.
I recognise that in a debate such as this it will be difficult to marry all the points that are made. I listened with great interest to what was said by the hon. Member for Tynemouth. His speech reminded me of the kind of speech that would be made to get the nomination for a safe Conservative seat. It seemed to be aimed more at traditional Conservative prejudices than at facing the reality of the situation in which we find ourselves. I do not think that anyone who is honest would deny that any Government taking office in February would have been faced with the need to make substantial defence cuts. There is no escaping that central difficulty.
I think that my right hon. Friend has faced the problem in a realistic way. After all, he has in the Chancellor of the Exchequer a former Defence Secretary, and very good one at that, who knows all the arguments. In spite of that, in spite of the pressure that must have been put upon him in the Cabinet, and despite pressure from some of my hon. Friends and others, my right hon. Friend has come to the sensible conclusion that many of us reached a long time ago; namely, that the main defence contribution of this country must be in NATO and on the central front.
There is no point in thinking that we can have the third battle of the Atlantic. We must, as a member of NATO, concentrate our resources on the central front, and this seems to raise the possibility that, in consultations with our allies, we may be able to work out a much more realistic strategy in central Europe itself.
I think that there is a need for modification, for a variant perhaps on the flexible response strategy, taking into account recent defence technology and bearing in mind the lessons of the Middle

East war, the use of the "Snapper" and "Sagger" anti-tank weapons, and the use of the modern SAM missiles against aircraft. But I should have some hesitation in inviting everyone to go along with my right hon. Friend in respect of the multi-role combat aircraft. I am in favour of the co-operation involved, as this is the way in which sensible defence procurement policies can be pursued, but I wonder whether this aircraft is not, in the circumstances, extremely vulnerable.

Mr. Alan Clark: Mr. Alan Clark (Plymouth, Sutton) rose—

Mr. Williams: I think that it would be better if I were to respond to the request by the Chair to make a brief speech so that other hon. Members will be able to take part in the debate.
Perhaps my right hon. Friend will reconsider the MRCA from the military point of view of vulnerability.
I believe that we are faced with the possibility of some kind of redeployment of forces in Central Europe itself. Does my hon. Friend the Minister of State agree that it is unlikely that there will be an increase in conventional forces? No member of NATO is in that mood. It is unrealistic to talk in terms of an increase in conventional forces, and that being so, it seems to me that we might move some of our forces back so that they are in a much better position to counter-attack.
The lessons of technology appear to be that the advantages are moving from the attacker to the defender. In other words, with the aid of technology and all the weapons that have been deployed in the Middle East one can have a strategy that gives the advantage to the defender and not necessarily to the attacker. I speak as a layman in these matters, and I throw these points out for consideration only, but, with respect, I do not think they can be dismissed contemptuously.
If there is unlikely to be a willingness to come forward with conventional forces, and if it is even more unlikely that there will be reserve forces, that raises serious difficulties. It raises problems about the nuclear question. The House knows that the Russians have about 750 intermediate-range nuclear weapons facing about 75 major cities in Western Europe and


that they are geared to go into operation in much the same way as the NATO strategy, which is a flexible response.
The argument thrown up by both sides of the House is that we are moving into a situation in which the nuclear threshold is increasingly being lowered. If that is so, I should like my right hon. Friend to tell the House what consultations he has had with the Americans, or what consultations the Americans have had with us about the use and deployment of tactical nuclear weapons. This is of vital importance for us because of our geographical position, and I should like to hear a lot more about the role of tactical nuclear weapons.
Some time ago I argued in a letter to The Times that we ought to consider the use of tactical nuclear weapons as a way of offsetting the preponderance of Russian forces on the central front. Nevertheless—and I say this tentatively because the implications for us are enormous, and it is not a policy that can be gone into without due consideration— in the end the essence of the matter is defence co-operation within the Nine. I know that this is a sensitive subject on both sides of the House, but there is nothing in the Treaty of Rome about defence implications, yet we saw a certain alignment of ideas with a common position arising from the European Security Conference.
The House will recall that the Davignon Committee enabled members of the Nine to reach an agreed position in respect of the European Security Conference. The implications of this in defence matters are clear to see, and this can be done without violating the Treaty of Rome by the proposals put forward two or three years ago by the former Foreign Secretary of Belgium, M. Harmel. It will be possible through these proposals for NATO to have a responsibility in areas where it considers that its interests are threatened by the Russians outside the Treaty area.
This approach would have to be thought through very carefully. I do not believe that it is any longer possible to go on speaking as if Britain were a world Power capable of discharging world responsibilities. We must all recognise that those days are over. However, we

can play a constructive part in NATO and thereby ensure that the future of mankind itself, which is the ultimate end that we all seek, will bring about stability in Europe. If we get stability in Europe, there is a good chance that we can get peace in the world as whole.

8.21 p.m.

Mr. Julian Amery: The hon. Member for Horn-church (Mr. Williams) made a most original and constructive speech. I hope that he will get some answers from his right hon. Friend, for what he said about the balance between the offensive and the defensive in modern strategy and the need for co-operation between the Nine in Europe struck chords to which I respond.
The underlying theme of the hon. Gentleman's speech, like that of the Secretary of State for Defence and every hon. Member opposite who has taken part in the debate, has been economic. The Secretary of State takes the line that we cannot afford the defence policy that we have and some of his critics below the Gangway have said that we cannot even afford what the right hon. Gentleman has proposed.
Unfortunately, that is not a new theme in this House. It is the theme that we had before both the First World War and the Second World War. There will be many who will ask whether the refusal to accept higher defence expenditure did not contribute to the outbreak of both those wars and to the setbacks that we had in their early stages.
I grant that we are facing the most serious economic and financial crisis since the war. The rearrangement of our business this week underlines that problem. Yet, I cannot help wondering whether the Secretary of State's proposals are relevant to the economic crisis through which we are going.
We have a double crisis: domestic inflation at home and the fear of a world recession. The right hon. Gentleman's cuts, particularly when they are offset by redundancy payments, golden bowlers, and so on, will have very little effect on the inflationary situation. Certainly in the next year or two they will mark a very small diminution in public expenditure.
The right hon. Gentleman's proposals may prove even more sinister concerning world recession. When there is a world recession our exports dry up. This is the classical time when rearmament often serves a constructive economic as well as foreign policy purpose, but to undertake it we must have the research development going on all the time and the forces and their bases to re-equip.
There is another economic aspect that we ought to have very much in mind. We depend for our survival and livelihood more than ever—certainly more than when we were a great empire—on access to raw materials in foreign markets Therefore, the safety of our trade routes is no less important—in some ways more important—than before.
I do not think that the cuts proposed by the Secretary of State can be justified on economic grounds. They might be justified on other grounds, but on economic grounds, unless the Government have accepted hook, line and sinker the gospel according to the Hudson Institute, these proposals cannot be justified.
This is not merely an economic problem. We have always been told that Socialism is the language of priorities. The hon. Member for Salford, East (Mr. Allaun) and others have talked about the need for better housing, better schools and the re-equipment of industry, but surely the security of what we have today is even more important than the improvements that we would all like to see.
If there were no danger there would be no, or very little, objection to the kind of proposals brought forward by the Secretary of State, but no one, least of all the right hon. Gentleman, is saying that there is no danger. Clearly he is not saying that. The right hon. Gentleman told us today rather more fully than in his statement a week ago about the steady build up of Soviet forces in central Europe, despite the fact that they are also increasing their forces on the Chinese border. The Russians do not worry very much about the proportion of GNP which goes on defence.
What are these forces for? They are much larger than are needed to defend the Soviet Union against any conceivable attack. They are larger than are needed

to subjugate any satellite revolt. There can be only one explanation for the decision to maintain these enormous forces— that the Soviet Government wish to keep open the option of using force, or the threat of force, if they think that it will serve their interests.
The Government, to do them credit, recognise that that is the Soviet purpose, and in response to it they have decided to concentrate as much of their main effort as possible in central Europe. Are they right to do so? Is that the right place to concentrate almost the whole of our overseas military effort? Will the decision whether the Americans stay in Europe and whether the alliance holds together depend on whether we maintain practically everything we have on the central European front? I spent two years at the Foreign Office studying, among other things, our defence problems. I was always left with the nagging doubt: was it possible that the Soviets wanted to pin down the main forces of the West in central Europe so that they could nibble away at the periphery? I do not know.
However, I cannot help asking, is this the time to cut back in the Mediterranean? Our military effort in Cyprus yielded a very good dividend in both the October war last year and the recent Cyprus troubles. Is the situation in the eastern Mediterranean more peaceful than it was? Can we say that relations between Greece and NATO are going to develop harmoniously again? Do we feel no concern about the future of Yugosalavia in the post-Tito period whenever it should come? Are we confident that Greece and Turkey will make friends again? Has the danger of war in the Middle East diminished?
At the same time, we should remember that Britain is the only member of the European Community which has a presence in the eastern Mediterranean. We and the Americans have not always seen eye to eye on Middle Eastern and eastern Mediterranean matters. Is this the time to leave them a monopoly of the Western presence in the area?
I join forces with my hon. Friend the Member for Tynemouth (Mr. Trotter) about the importance of the northern flank. After all, it guards the approaches to the eastern Atlantic, the sea lanes to


this country, and the approaches to our vital North Sea oil.
I should like to comment on the reductions proposed east of Suez. A very high proportion of our trade lies with the great crescent of countries around the Indian Ocean—New Zealand, Australia, Singapore, Malaya, the sub-continent, the Persian Gulf and down the African coast to South Africa. We get many of our raw materials from there. We pay for them by the goods we sell there. We still have very substantial investments in that area. When we face economic troubles, is this a time to cut our insurance policy and to diminish our commitment in the Indian Ocean when the Soviet commitment is growing steadily?
I agree that it is no good dropping backwards. I am one of those who believe that if we had stayed and maintained a military presence in the Gulf, the price of oil might not have risen as it has risen, and we certainly should not be reading in the newspapers today about plans by the Pentagon to make a possible descent on the Persian Gulf littoral. Is there not really a danger today that one super-Power or the other may take rash action there? Is there not a danger that Iraq, serving as a cat's-paw for the Soviets, may extend its influence down the Gulf? Here at least I congratulate the right hon. Gentleman the Secretary of State on having decided to maintain our commitment to Oman and, presumably, to the station at Masirah. This stops us from producing a total vacuum in the area.
Going further south from the Gulf, does it really make sense for us to terminate the Simonstown Agreement when the Soviets are developing facilities in Aden and Somalia—and, perhaps tomorrow, in Ethiopia? Is it really wise for the West to retreat from Southern Africa when the potential enemy is digging into the Horn of Africa? The Simonstown decision is purely political. We all know that. We are told that it is provocative to the African countries if we maintain this rather special relationship with South Africa.
If the Secretary of State had said that in return for leaving Simonstown he had special arrangements with Mombasa or Dar-es-Salaam we should all take a great interest in what he said, but we are here surrendering a tangible asset in the hope

of getting goodwill. Suppose we do not get it. It is a little odd to be doing this when, for the first time for a generation or more, there are signs of improvement in relations between South Africa and the black African countries. It would be a supreme irony if we should quarrel with Pretoria just at the moment when they were mending their fences with their African neighbours, and if we were then to ask for the return of the Simonstown facilities and they were to say, perhaps, "It would complicate our relations with our new non-aligned neighbours."
It is a foolish decision, but the folly is compounded by the decision to withdraw from Mauritius and Gan. There may be an argument for withdrawing from one or the other, but to withdraw from both seems very dangerous.
I want to ask one or two questions about Gan. What is to be its future? Are we to pay compensation to the Maldive Islands for the loss of income which will result from our withdrawal? The treaty signed in 1965 by the Labour Government runs, I think, to 1986. Under that treaty we, and we alone, have the right to use the facilities at Gan. Shall we be abrogating the treaty? If we are not abrogating it, and we withdraw, how shall we enforce it? How shall we stop the Soviets or someone else coming along and making use of the anchorage and air facilities? How do we stop someone else making use of the remarkable complex that we have built up at enormous expense?
I am glad that we are going ahead with the joint development at Diego Garcia. I welcome that, but it will be a long time before Diego Garcia is even as strong as Gan. It could never be Singapore. It will also be under dual control. Dual control means a danger of ineffectiveness in a crisis.
I come now to Singapore. My hon. Friend the Member for Chichester (Mr. Nelson) made a very remarkable maiden speech. He was very right to remind us of the success of British arms in the confrontation with Sukarno's Indonesia 10 years or so ago. That was a remarkable victory achieved at a remarkably low cost. Britain was the cement which made that achievement possible. Take away that cement and the five-Power system which has been built up may fall apart. South-East Asia, as we see from what


goes on in Vietnam today, is none too stable.
Of course, as the Secretary of State has said, Britain by herself can no longer act as the policeman of the world or play alone a world role. We do not suggest that that should be so. Thanks to Simons-town, there has just been an extremely effective four-Power naval exercise, South African, British, French and American, off the South African coast.
Looking ahead in Europe, we can appreciate that if we build up a Euro pean union it is bound to be outward looking because it will not have the raw materials of the market which it needs outside Europe, so it will be dependent on these trade routes. Because of the legacy of history, we happen to be established in certain places with the good will and acceptance of the inhabitants and Governments concerned. In a sense, we hold our position in Singapore, in Gan, in Simonstown—or we could hold it there—in trust for Europe. Is it wise to throw these cards away? Nobody else can pick them up all that easily. Certainly nobody else in Europe would have the chance of doing it. It is not as if the Europeans were interested. It is only the Americans who are interested to retain the footholds we still have.
I was very struck—if the Press report is accurate—by the emphasis which the German Minister of Defence, Herr Leber, put on this in his intervention at the recent NATO meeting in Brussels. Some hon. Members may think that I am exaggerating the threat to our trade routes.
Reference has been made to the enormous strength of the Soviet submarine fleet. In this respect we need to think of the submarine menace which in the First and Second World Wars nearly brought us to our knees.
What are those Russian submarines for? Again, the option can be only to use force or the threat of force. The submarine option is more flexible than the land option. It could be used without necessarily leading to all-out war. There could be random sinkings of our shipping, just as there were random sinkings of our shipping in the Spanish Civil War by Italian submarines in the Mediterranean. There could be a blockade of important trading areas—the Persian Gulf, or South Africa. Are we to sit

idly by if this happens, or are we to be expected to sit idly by if we cut out our maritime reconnaissance and the staging posts from which certain of our submarines and aircraft operate?
I am opposed to the cuts which have been proposed. I think that, if anything, we should increase expenditure at present, at a time when we have, in number, a third of the number of tanks that Israel has with 2½ million people—Israel has about 3,000 tanks and we have about 900—and at a time when we have about half as many tanks as the Syrians, a nation of about 4½ million people. I question whether, even within the assumptions on which the Government are proceeding, they have their priorities right. Of course NATO is of immense importance, but our top priority, if we are to cut to the bone, must be the defence of this island and its supply routes for our 55 million people.
Just as Winston Churchill was right not to commit the Royal Air Force to the Battle of France in 1940, so in the last analysis must we depend on our own nuclear deterrent, on our sea and air power, and on the sea and air transport which serves as the legs of the Army. I see great dangers in the balance with which the cuts are being applied—by sea, in the air, on the flanks, and in research and development.
We are only at the beginning of the defence debate. There is still the White Paper to come. It is to be a five-year programme. Much still lies in the future. I agree with the hon. Member for Horn-church. I, too, see some advantage in the fact that there is still an area which is grey and indefinite.
I regret that the Secretary of State's proposals correspond to no theme or philosophy, to no grand design. They are an attempt to meet the usual demands of a Chancellor of the Exchequer who should know better but who has, by all accounts, exploited his experience in defence to play the bully against a weaker though more honourable colleague. It is an attempt to make a compromise between protecting our national interests and meeting pressure from a Left wing which at least is influenced, whatever the hon. Gentleman may say, by the thinking of Britain's enemies. As a result, in putting forward the defence review, like


the social contract or the referendum, the Government have never had in mind any kind of system, right or wrong. They have simply invented a tale for the day so as to sneak out of difficulties in which they became engaged at their party conference.
However, I do not despair. I do not think that this Government will last. I think that a Government of national unity will come. When such a Government appears the House of Commons will call for and get a defence policy that corresponds to Britain's national interest and to the defence of our island and our supply lines.

8.40 p.m.

Mr. Frank Hooley: I shall not try to cover all my right hon. Friend's statement. I shall deal with only three aspects—Simonstown, the Hong Kong garrison, and manpower.
Recently, military exercises with South Africa have been bigger and bigger and have involved not only the Navy but the RAF. I therefore welcome my right hon. Friend's statement that we intend to change this policy—at least, I hope we do—by negotiating the termination of the Simonstown Agreement. I would go further and inform the south African Government that we intend to abrogate the agreement without delay.
I should like some assurance that there is no intention that naval and military co-operation with South Africa will go on after the agreement has been finished. I should like a firm assurance that there will be no future British naval visits and no secret defence understanding with South Africa—that we shall terminate all military exchanges, visits and technical arrangements with that country.
The problem in that part of the world is not military but political. Opposition Members who do not believe that should pay attention to what has happened in Angola and Mozambique. For 15 years this country—under successive Governments, I am sorry to say—gave full military, diplomatic and economic support to the Portuguese dictatorship in Angola and Mozambique while the African Socialists were fighting in Guinea and Mozambique to destroy it. They have succeeded in their policy and we have failed in ours. It would be a dis-

aster if this country drifted into the same position with regard to South Africa.
I should like to say a few words about Hong Kong. It seems to be just a British wart on the nose of China. In his statement my right hon. Friend says that we intend to keep our forces in Hong Kong, which to some extent seems to contradict his general proposition, reiterated in his speech today, that in future we shall concentrate our efforts within NATO and the European theatre.
What I simply do not understand is the proposal to abandon Simonstown, Gan, Mauritius and Singapore, but to stay in Hong Kong—to break away all the links in the chain, but, as it were, to leave the pendant floating in mid-air with no linking mechanism or defence. In simple logic, that does not seem to make sense.
I cannot understand why these 10,000 men should be in Hong Kong at all. It cannot be for defence. It cannot be seriously argued that 10,000 infantry, with a few tanks and artillery but no air cover or anti-aircraft protection, and no anti-aircraft missiles, are there for any serious defensive purpose. From where is the attack to come; from Japan. Russia or China?
This is the only remaining overseas garrison of any size, and it makes absolutely no sense. Is it there to uphold some form of Western democratic government in Asia? One could hardly argue that. There are no elections to the legislative council, no elections to the executive council, and the urban council has fewer powers than Sheffield District Council. In the annual report for 1973 there is the clear statement that
The policy of Her Majesty's Government in the United Kingdom is that there shall be no major constitutional change.
There are good reasons why there should not be constitutional change. The Chinese Government would take strong exception to it if there were.
China has taken the view for a long time that Hong Kong is a Chinese city. There is a lease on the territories concerned, but the Peking Government see absolutely no reason why Hong Kong should not be regarded as a Chinese city. Why on earth should I go back to the old-age pensioners in my constituency and ask them to pay heavy taxes to maintain a British garrison in a Chinese


city? There is no democracy there, but there is vicious exploitation of women and child labour. There have been serious allegations of widespread corruption throughout the administration. There are appalling housing and social conditions and, what is most sinister in present circumstances, there is rising unemployment.
It may be argued that the garrison is not there for defence in the orthodox sense but simply for some form of internal security. In my view it is not the business of the British Army to act as a gendarmerie to police a 19th century colony, particularly where there are no institutions of self-government and where there is serious exploitation of women and child workers. If it is necessary, for internal security purposes, to keep a force there, there should be a local militia of some kind, which is locally raised and locally financed. If the Peking Government object to that, we should say quite bluntly and shortly that the lease is terminated and we are withdrawing.
As regards manpower, my right hon. Friend is proposing that there should be, over 10 years, a rundown of 35,000 Service men, and about 15,000 civilians in the United Kingdom, which would release 50,000 people for productive work in United Kingdom industry and which in itself would be useful.
A more unsatisfactory aspect is that the reductions in the planned defence programme are likely to reduce employment in the defence industry by only 4 per cent. by 1978–79—that is to say, by about 10,000 people. That is not good enough, in the light of the deficit of £534 million on our overseas balance of payments last month.
Contrary to the suggestion made by my right hon. Friend, the problem in this country is not one of unemployment, and he does wrong to try to terrify the Labour Party and the general public by parading the spectre of unemployment. There is a shortage of skilled labour at the moment, to a large degree concentrated in the engineering industries, which are engaged in producing much of our armament.
If my right hon. Friend argues that cancelling major weapons projects will result in mass unemployment, I am afraid the historical record is against him. A Conservative Minister cancelled Blue Streak. A Labour Minister cancelled TSR2. If

my right hon. Friend will consider the history of weapons system throughout the 1950s and the 1960s he will find that many projects of advanced war technology had to be scrapped, either because they were inherently unsound in a strategic sense or, more likely, because we could not afford them. It will not do for him to argue that if we decide to run down the armaments industry there will be mass unemployment.
I should like to give some examples of areas in which we could be ready to deploy our resources, with great benefit to the country, by providing equipment for the exploitation of North Sea oil. There is a myth current that to exploit North Sea oil we need simply to build great oil rigs. Of course we do, but they are in some respects just one part of the business of extracting the oil. I should like to give a list of equipment required for the exploitation of North Sea oil, much of which is being purchased from abroad, or which British industry cannot or will not produce. The list includes diving equipment, generators, diesel motors, derricks, pumps, storage tanks, cranes, helicopters, light aircraft, steel pipes, valves, compressors, gas turbines, water distillation units, flooding equipment, fire fighting equipment, alternators, switch gear, electrical distribution systems, welding equipment, gas treatment equipment, oil pumps, deck winches, cargo barges, derrick barges, tugs, drill ships, tankers, support ships, and many more items.
I could go on at length. I have drawn this long list of items from the IMEG Report of 1972—two years ago. They are all items of equipment required on the rigs or for the exploitation of North Sea oil. There is a market there worth £10,000 million in the next 10 years. It is a market into which British industry has only begun to get over the past 18 months, and it is one to which we should pay far more attention.
In recent years, one of the most appalling aspects of this business has been that the shipbuilding industry has been so preoccupied with refitting Chilean destroyers, with its defence contracts, and so on, that every time people have asked, "Why do not you go into the North Sea oil business? Why not develop your resources and diversify your efforts as Norway has done?", its excuse has been, "We have enough work on hand. We are not


bothered. We are not interested." It is very important to tackle much more vigorously and much more effectively the redeployment of our manpower and of our industry away from armaments and into peaceful production. It also affects our capacity in worldwide export markets. I do not regard it as satisfactory that we should over the next 10 years contemplate keeping 250,000 workers in non-productive armaments.
I am not tempted to make any general apparisal of the defence strategy outlined by my right hon. Friend, but I believe that these are three very important points. South Africa is a political and not a military problem. As for China, it is utterly absurd to leave 10,000 British troops on the coast of the mainland of China for no useful purpose. Finally, it is essential that we switch the productive resources of British industry from munitions of war to the munitions of peace.

8.52 p.m.

Colonel Sir Harwood Harrison: The Defence and External Affairs Sub-Committee, of which I have the honour to be Chairman, will wish to study these defence cuts in some detail before coming to any firm conclusions. We shall be doing this early in the new year and shall be reporting. However, if we accept that in the present economic situation some further cuts have to be made in defence spending, in principle I extend a cautious welcome to the way in which the Secretary of State appears to have tackled the subject.
In our last report on the defence cuts made by the two previous Government, my Committee urged that there should be no more short-term cuts without corresponding reductions in commitments, and we expressed the hope that this defence review would result in long-term stability for the defence budget at a sustainable level calculated to meet our commitments. Some of us have reservations about the rundown of our forces in Cyprus after the part played thereby the events this year, thus reducing our commitment to the defence of the southern flank of NATO. Cyprus was the southern claw, and the RAF there was a very great deterrent.
I personally may be emotionally critical of our leaving Singapore. I was there 30

years ago, but I have been back there since and seen how much both Singapore and Malaysia like having our forces there as part of the Five-Power Pact, whilst they are training their own.
Armed forces can be effective and can maintain high morale only if they have modern equipment and all Service men know that they will get a fair deal I am glad that the Secretary of State said that our forces would be equipped to the highest standards and that fine career opportunities would remain. Therefore, I repeat that my Committee will be looking in detail at the right hon. Gentleman's decisions. In general, we accept that, rather than deny our forces modern and effective weapons, we should be prepared to reduce the number of Service men whenever possible.
It is often said that we spend more in terms of GNP than some of our NATO allies. It can equally be said that we spend less per head on defence than Germany, France and the United States. That is no more valid an argument for increasing defence expenditure than is the percentage of GNP a reason in itself for spending less. This was brought out very well by my right hon. Friend the Member for Worcestershire (Mr. Walker) when he opened the debate from the Opposition Front Bench. We seek to maintain a reasonably well-paid, properly-equipped professional force. This is bound to be an expensive business.
Those who seek massive cuts in defence spending beyond the substantial reductions proposed in this review should say whether they would prefer to bring back conscription and get defence on the cheap or whether they would allow our forces to run down to a much reduced level. If it is the latter, I suggest that they have not learned the lessons of history.
I turn to a few specific subjects which have been considered by my Committee. In February we reported on the multi-role combat aircraft, much mentioned in today's debate, and recommended a stringent review of the air defence version of this aircraft. We also commented on the cost increases. In doing so we hoped to stimulate constructive criticism rather than to attack the project. We saw the aircraft in Munich last year and were very pleased with what we saw. Having talked to the RAF, we fully accept that it must have modern aircraft, and the


MRCA—which has the advantage of being a collaborative project with Germany, Italy and ourselves—seems at present to offer the cheapest and most effective solution. I and some members of the Committee are to visit the British Aircraft Corporation factory near Preston on Wednesday and hope to see this aircraft flying.
The Secretary of State said on 3rd December that we are to continue with the MRCA programme although we may have to make a reduction in the planned rate of deliveries over the period. I am glad that today he was specific and said that it was still intended to buy 385 of these aircraft. He was not so specific about what the delay would be or how far away the purchase was. Perhaps in replying the Minister can give us more details.
My Committee also looked at the Royal Navy's through-deck cruiser, now being called the anti-submarine cruiser. The first of these is now being built. This is another major project which we have examined. We were aboard HMS "Blake" during our visit to Gibraltar this year. We appreciate that a new purpose-built ship to carry Sea King helicopters will provide a much more effective fighting force with a smaller crew. It is a high priority for the Navy.
The Secretary of State said that this programme will continue. Can the Minister tell us how many of these cruisers we are to have? I understand that the keel for the second cruiser should be laid about now. Will this happen? The cruiser is intended to operate not on its own but as part of a task force which might include ships from other NATO navies. It seems more likely that a cruiser task force will need to use NATO escorts as a result of the decision to cut the frigate and destroyer force. Can the Minister give us an assurance that the cruisers will be adequately screened in view of what Admiral Sir Peter Hill-Norton is reported to have said on 11th December in The Times, to the effect that NATO ships cannot always communicate properly because two incompatible communication systems are in use? If what he claims is true, who is responsible for doing something about it, and how long will it be before something is done?
I am a little at a loss to understand how it will be possible to carry out the

full cut in the Army. Are we not counting some soldiers twice over—that is, they are with their battalion which is in Germany and are counted as part of BAOR and then they are seconded to do a short tour in Northern Ireland and counted there as fighting troops? If the tragic situation in Northern Ireland were to be resolved, possibly these cuts would be more understandable, but the House will require a very good explanation of them.
I am glad that there is to be no cut in our four Polaris submarines. To my mind—and I have studied this matter— they are the best deterrent we have. We acquired them extremely cheaply through the generosity of the United States and it is vital that we retain them. They are at present effective. But we have to look ahead and it may be that when the Americans have built their Trident submarines, with their far greater range, they will be posted on the eastern waters of America and be in a position to land missiles from there beyond the Iron Curtain.

Mr. Bob Cryer: Good heavens.

Sir H. Harrison: The hon. Gentleman says "Good heavens", but these submarines have not yet been built. We heard details about them when we were there.
I hope that when the Secretary of State discusses the defence review with our NATO allies, and in the Eurogroup meetings, he will continue to take a strong lead in proposing action to secure further standardisation of equipment. I congratulate the right hon. Gentleman on being made chairman. The Defence Sub-Committee is well aware of some of the obstacles, rooted mainly in national and industrial interests, to more effective cooperation. I am sure that the right hon. Gentleman will have the support of the whole House in his efforts to achieve progress in this difficult field, in which some, but nothing like enough, progress has been made in the last 10 years. Perhaps the answer lies partly in a series of reciprocal deals with our major allies, with each nation specialising according to its ability. It would be intolerable if we were to go on duplicating expensive research and development work and producing weapons which are incompatible


with those of our allies while procurement programmes were being cut for lack of resources.
I wish to say a few words on the question of manpower, the cost of which accounts for nearly half the defence budget. The defence review proposes a reduction of 65,000, of which 30,000 are civilians, and which, I take it, will mainly follow reductions in commitments. My Committee only recently was considering ways in which manpower savings could be made without reducing commitments. Last week we heard that the Royal Air Force had saved 7,000 posts between 1971 and 1974, worth about £20 million a year, by a determined economy drive inspired from the top by a small vigorous team in getting the whole co-operation of the Royal Air Force. Those responsible for initiating and pursuing the project deserve our congratulations.
Both the Army and the Navy have reduced their manpower, but the savings in the Royal Air Force in the last three years or so have been proportionately much greater. We were therefore rather disappointed that the imaginative approach adopted by the RAF had not, through the Ministry of Defence, been tried in the other two Services.
Earlier this year the Committee looked at training, a subject in which the hon. Member for Bishop Auckland (Mr. Boyden), whom I am glad to see in his place, takes a special interest. Here again we felt that economies could safely be made if the Services were prepared to accept an even greater degree of flexibility. We want more joint training. More important perhaps, consideration of training leads us to think of ways in which the Services' operational facilities can be unified or simplified; for example, by using the same forms for pay and records.
The Committee intends to report its findings on manpower and training early in the new year. I know that the Minister will read the report carefully, but may I assure him that we seek to present constructive criticism, and we recognise that there are obstacles to overcome? We do not expect sweeping changes to be made overnight, but we believe that worthwhile recurrent savings can be made if common problems are tackled

together, particularly at headquarters level, rather than on a single-Service basis. In the aftermath of the defence review, in our present economic difficulties, I hope that there will be a fresh impulse for the Services to work as a team, even if they have to sacrifice a degree of autonomy.
Having spoken, I hope objectively, about the cuts which have been made, I must issue this word of warning to the House. I am afraid that the cuts will be taken by many people without being examined in detail. That is particularly so of Service men, and I am worried that this may have a grave effect on their morale. I ask the Minister to see that the cuts are well and carefully explained to all Service personnel. If it is essential in the Government's view to cut our Services, I put in a special plea— which has been mentioned frequently today—for the building up of our reserves. I am an old TA officer, and I believe that the reserves are one of the cheapest forms of Army one can have.
I feel that the cuts are not being well received by our allies across the Atlantic. They have always looked to us to be the leaders of Western defence. If we falter, how much more will our weaker allies falter? We may get to the position in which the Americans will say "If Europe is not prepared to defend herself, why should we bother? "To have American forces in Europe is alien to the traditional policy of the United States, whose citizens were escapists and nonconformists from Europe in years gone by. When Mr. Harold Macmillan was Prime Minister he said that to me, and remembered it in all his policies.
When I was in Washington last year I found a body of opinion in America in favour of withdrawal from Europe. So far as I could tell, it was centred in a section of the Democratic Party. Who knows, if at the next presidential election a Democratic President with a vast Democratic majority in the Senate and Congress is elected, that feeling might mount and concessions would have to be made. This needs the highest consideration at the highest level.
All this is taking place when, from the best intelligence I can get, Russia is still expanding her forces on her Western borders. She is not now building up so much in the East. Why is that? What


does she want? Are we wise, for the sake of a few comforts now, to mortgage the whole future of our country?

9.4 p.m.

Mr. Robin F. Cook: A year ago tomorrow the then Chancellor of the Exchequer announced in the House that he would cut defence expenditure by £178 million. I have listened carefully to all the Opposition speeches but have failed to detect in any of them even a hint that the speakers were conscious of the irony that they are celebrating that anniversary by attacking my right hon. Friend for his much more cautious approach to the matter. I remind the Opposition that the cuts imposed in December last year were not phased over 10 years. They had an immediate impact on the defence programme. They were based not on an analysis of our commitments but purely on financial and economic stringency.
The right hon. Member for Worcester (Mr. Walker) has had great fun at the expense of Government Front Bench spokesmen, on the basis that they cannot provide hard facts and figures to flesh up the defence review which they have announced. I refer the right hon. Gentleman, or, in his absence, the hon. Member for Ayr (Mr. Younger), to the last report of the Defence Sub-Committee of the Expenditure Committee where he will find that as late as June this year the Ministry of Defence still did not know where the cut of £178 million was to fall in the Budget. My right hon. Friend the Secretary of State is to be congratulated on not adopting a similarly irresponsible approach.
Having said that, I am afraid that there I leave him. I have listened carefully on a number of occasions when he has tried to argue that his increase in defence expenditure comes within the scope of the word "savings", but I have not been persuaded. I was in the House last Monday when my right hon. Friend the Secretary of State for Energy announced that he hoped to save 10 per cent. of our energy consumption over the next few years. Is there an hon. Member in the House who was then present who would not be outraged by a sense of deception if it were to turn out that my right hon. Friend the Secretary of State for Energy had meant that there would be an in-

crease in energy consumption, because the expected increase would outstrip the 10 per cent. cut proposed? If he did not mean that, we must say that the Government are using the same word, namely, "savings" to describe two very different concepts, and to put it no more strongly that does not lend itself to clarity.
Even if we accept the idea that any reduction of anticipated expenditure is a saving as a working definition, our right hon. and hon. Friends are putting it against the wrong measuring rod. They are comparing the expenditure under their review with the figures announced in the 1973 public expenditure forecast. That forecast was drawn up in the autumn of 1973 in a very different economic climate, before the three-day working week and before the oil crisis—at a time when at least one hon. Gentleman opposite was talking about Britain suffering from the problems of affluence.
We are in a different situation now. I appreciate that the Opposition, in discussing this defence review, have to huff and puff and blow with all their might. Indeed, they have a constitutional duty to do so. But if they were in office now and compiling the public expenditure forecasts for the next five or 10 years, they would be making cuts in defence. Those cuts would probably not be precisely the present cuts—probably they would retain the Gurkhas and the Marines, for which there are powerful lobbies in their party—but there would be cuts.
If my right hon. Friend the Secretary of State is going to insist on measuring his savings against anticipated expenditure, and if he is to be fair, he must measure them not against the expected expenditure in 1973 but from what it would have been in 1974 without his defence review—the expenditure which the Opposition would have embarked on had they still been in office. If we adopt that definition we are faced with savings probably not of hundreds of millions of pounds but only of tens of millions of pounds.
If we turn to the review, it is not surprising that we are getting a gloomy financial picture emerging, because where the cuts fall the savings are largely illusory.
I want to deal with the manpower cuts that have been mentioned a number of times in the debate. The review proposes to cut manpower by 35,000 over


the next five years. I took the precaution of arming myself with manpower figures for the past 15 years that I obtained from the Library. Over the past five years manpower has fallen by 30,000 in any event—in other words the projected reduction over the coming five years is almost exactly the same as the actual reduction of the past five years, for most of which the Opposition were in power.

Rear-Admiral Morgan-Giles: When do we reach zero?

Mr. Cook: The hon. and gallant Gentleman raises an interesting question. I have here a graph of recruitment to the Armed Services over the past five years. Going by the graph, we are in danger of touching zero in the foreseeable future.
On the basis of recruitment, we shall cut more than 35,000 from our defence personnel within the next five years. I suspect that my right hon. Friends have taken the recruitment figures of recent years and projected them to see what the establishment will be anyway, and then reduced that establishment in line with the figures. That is sensible, because if one is to end up with a force below establishment one should reduce the establishment figures to bring them into line. But there is no point in pretending that one is saving money by doing so.
If we turn from what is in the defence review to what is not, we find an extraordinary feature. The review is apparently aimed at saving money, yet all the major projects, the most expensive projects, have got through unscathed. The through-deck cruiser is still in our programme, although we do not know how many such cruisers we shall have. I suspect that the through-deck cruiser has been retained not so much as a result of an analysis of the kind of Navy we shall need in 1980 but because of the Navy's traditional preference for large surface command and control ships.
The MRCA is also still in our programme, apparently with every one of the 385 models with which it entered the defence review. That is a measure of the pressure of the Royal Air Force in demanding a traditional manned fighter force. I am disappointed, even if the hon. and and gallant Member for Eye (Sir H. Harrison) is not, that the Defence Department did not seriously examine the

suggestion that the air defence rô1e could be adequately served by missiles.
The greatest prestige system of them all, Polaris, is still there, and will apparently continue throughout the period covered by the review. I am glad that the hon. Member for Inverness (Mr. Johnston) has returned to the Chamber. I appreciated his comment that the mention of Polaris in the review is almost Delphic in its obscurity. Some time in the next 10 years we shall face a decision on the future of Polaris, because it will become obsolete in that period, for technological reasons. There is no mention of that in the review.
The House is indebted to Margaret Gowing for her comprehensive work on the history of the way in which we got into the nuclear business in the first place. It is significant that it is almost impossible to identify any conscious decision to go nuclear. In the light of that, it may be reasonable to hope that if we are to cease to be a nuclear Power in the next 10 years, as looks likely, it may be the result of a deliberate and conscious choice and not a decision forced on us by economic and technological decline—which is the way in which we have changed our defence posture every time in the past 15 years.
My right hon. Friends may reply that all these weapons systems—through-deck cruiser, MRCA, Polaris—have to be retained because they are committed to NATO and are essential to our role in NATO. Here we come to the crux of the matter, because if we insist that we shall remain a leading member of an alliance based on sophisticated weapons systems, no substantial cut in defence expenditure is available to us.
There have been many changes in the past 10 years. Listening to some Conservative Members, one would not think so, but there have been diplomatic and economic breaks through in East-West relations. For example, the German position has largely stabilised, through actions of the Germans themselves. The substantial increase in trade between East and West is bound in time to be more effective and more important than any diplomatic breakthrough.
The tragedy is that these diplomatic and economic détentes are not reflected in any comparable military détente. The


reason is that both sides—I accuse both equally—have created military-industrial complexes which are developing military technology at a rate which has a mad momentum of its own and which continues regardless of the economic and diplomatic changes. The most depressing thing about the defence review is that it projects that trend for the next 10 years, and sees us in 1984 with both NATO and the Warsaw Pact countries armed to the teeth and glaring at each other over the Berlin Wall in a state of armed hostility.
The real absurdity is that the kind of prestige hardware one needs for that kind of confrontation is ludicrously irrelevant to the rôle the Army has had since the war. The place where the Army is most involved is Northern Ireland. I am surprised that so many commentators on defence still insist that the role of the Army there is an aberration from its real job and that some day soon it will be able to get back to fighting Russians and Poles.
I do not wish to be pessimistic. Like everyone else in the House, I hope that the Army can get out of Northern Ireland as soon as possible. But it has been there for almost as long as the duration of the Second World War, and there are men in senior places under the Secretary of State who believe, with some force, that the role that the Army has in Northern Ireland now is likely to be more typical of its job in the next 30 years than the kind of role envisaged in the defence review—fighting a highly sophisticated, highly advanced, global enemy. There is no hint of that in the review.
I return to the essential economic point. Five years from now—at the end of this Parliament, when my right hon. Friend and I are returning to our constituencies to seek re-election—we shall be spending more than 5 per cent. of our gross national product on defence. I accept all the criticisms of this as a measure of our defence expenditure—that it is rough and ready, and that it does not adequately value the cost to a country of a conscript army. But it is the best available measure to compare the proportion which each country devotes from its economy to defence expenditure.
If, therefore, we accept it as a standard of comparison and look five years ahead,

we find that, far from averaging with our allies, we are likely to move up from third place to second place in NATO in terms of the percentage spent on defence, because it is certain that Portugal will drop down in the scale, since it is going to cut its defence expenditure. We shall have the ludicrous situation in 1980 of Britain, by then one of the poorest countries in NATO, remaining one of the last of the big spenders.
The latest report of the Defence Sub-Committee of the Expenditure Committee said:
The Committee would also draw attention to the very serious implications for future expenditure if the Ministry of Defence continued to base their forward approach on an unrealistic projection of growth in the gross national product.
This defence review is based on a 3 per cent. growth per annum. I suspect that one thing which unites the supporters of both amendments is that we do not believe that we shall have an annual growth of 3 per cent. over the next 10 years. If we do not have such growth we shall be faced with annual reviews of defence expenditure of the sort we had from the Conservative Government last December, with short-term, disruptive and damaging cuts in defence. Perhaps the time will come in the not-too-distant future when many in this Chamber will wish that they had not caused such disruption to the Armed Forces by not reaching out and grasping the nettle and bringing defence expenditure into line with our economic expectations of the next five years.

9.19 p.m.

Mr. Julian Critchley: This debate is the hors d'oeuvre for what promises to be a four-course lunch—four defence debates between now and the beginning of March. Whether this means that defence is at long last becoming a fashionable subject to debate, I am not so certain, but I would like to think so. It has always been an unfashionable topic, certainly as long as I have been in the House. The House of Lords speaks with rather more authority on defence than we do, yet outside this place there is an intellectual awareness of the problems of defence not always reflected in the House of Commons itself. Perhaps times are changing, and perhaps this is a symptom of something that will improve.
I am sorry for the Secretary of State and the Minister of State. They are both robust defenders of the concept of collective security. They are social democrats. Indeed, the Minister of State might possibly claim to be the first social democrat in the British context. Yet the Secretary of State and the Minister of State are responsible for a defence review the object of which is to reduce defence spending to an artificial limit at a time when our enemies have never been stronger. Just as "renegotiation" is a sham, a device to neutralise the division of opinion within the Labour Party over Europe, so the defence review is simply an adhesive, a pot of glue, which at some risk to the security of the West may succeed in making a gift of apparent harmony within the Labour movement.
The Secretary of State has claimed more than once that NATO remains the linchpin of British security while at the same time announcing reductions of defence spending, which, even were his example not to be followed by our allies, must weaken the capacity of this country to wage war.
The right hon. Gentleman's argument about the proportion of GNP spent on defence by Britain and her allies is specious in the extreme. We are in no position to claim that we contribute more than our fair share to NATO as a whole. As has been said by many speakers, we make a contribution that is considerably less than that made by either France or Germany. In fact, our contribution on an annual basis is 67 per cent. of the German defence budget, and our figure is boosted by the fact of a volunteer army that has within it a large provision for social welfare and education. And why should our share of the common defence be measured, not by the strength of our enemies, but by the contributions of our friends?
We should be engaged in strengthening the NATO alliance, not in weakening it, and I am fairly certain that hon. Members will have seen on the tape—

Mr. Douglas Hoyle: Why should not it be measured against the economic position of the country? Surely that is the test of what we can spend on defence.

Mr. Critchley: The defence of a country is the first charge upon its

economic resources, and when one looks at the rate and pattern of expenditure in general, and sees the smaller proportion of money spent on defence in the past decade, and compares that with the Soviet threat, one realises how foolish it is to make reductions at this time.
I wonder how many Labour Members have seen this evening's news from Brussels, which is that Dr. Luns, the Secretary-General of NATO, has expressed anxiety and apprehension about the Government's defence review. So much for the warm welcome that our allies have given to this document. Mr. Schlesinger's remarks were less than enthusiastic, and now they have been followed by those of Dr. Luns himself. I wonder whether that point might be put to the Secretary of State on his return from dinner.
When the Dutch suggested earlier this year that they reduce the number of their forces in NATO it was agreed within NATO that after the bargaining and consultation between NATO and Holland the military council should meet and agree a communiqué that would set out the results of the threatened reduction in the Netherland's defence expenditure. That happened for the first time. Will the Secretary of State be prepared to act in a similar way with our defence review at the end of six weeks of consultation and discussion in Brussels?
At present, force levels in Europe are just adequate to ensure deterrence as required by a strategy of flexible response, and, at the moment, two factors still work in our favour. They are rationalisation, if it can be made to work, and the MBFR talks in Vienna. Clearly we must build a more effective system of defence at levels of expenditure no larger than now exist, but were rationalisation to fail, and were the allied position at Vienna to crumble—the Netherlands have already broken ranks at Vienna—and, as a consequence, unilateral reductions in our "ready" forces take place, NATO would be unable to sustain its present strategy.
If this were to happen, have hon. Members opposite, especially those who are not in favour of defence, who perhaps hanker after a neutral Britain— whether that Britain could have an armed or a disarmed neutrality is a point that we have never been able to extract from them—thought through the implications?


Let us go through the implications of being obliged to alter NATO's strategy because the number of our "ready" forces are reduced.
Were flexible response to fail, one possibility would be a return to the immediate, and first, use of nuclear weapons—the tripwire strategy of the 1950s and early 1960s. Is there any hon. Member who still believes that nuclear weapons would be used first against a Russian conventional attack? Has the Labour Party been reconverted to a reliance upon a nuclear strategy? The decision to introduce nuclear weapons into the battlefield would be continually postponed for fear of Soviet reprisals.
Nuclear weapons deter nuclear weapons. Conventional weapons deter conventional weapons. Even were the strategy of flexible response to be kept, even if we were still able to keep a sufficiency of "ready" forces, any strategy which relies upon the uncertainty of response must become less credible with the passing of time.
Allied nuclear weapons, large and small, are effectively under the control of the United States, However, the United States and the USSR are now effectively restricted to the use of non-nuclear force in almost every conceivable situation in which force might be needed. Are the Government, therefore, placing their hope in the fact that the United States, will be prepared to keep in Southern Germany the same number of land forces as they have for the past 15 to 20 years?
If not the "tripwire", the only alternative would be the substitution of a strategy which would be based upon warning, but would that short period— a day, a week—be used with courage and determination? Would the politicians, faced with a crisis, be prepared to take the measures necessary to overcome weaknesses in deployment, which are very great indeed, and summon reinforcements from abroad at a time of tension? Would not the signals of Soviet movement and manoeuvre be filtered out by our preconceptions? Would we not see only what we wanted to see? History is filled with examples of warnings unheeded.
The truth is that NATO is being nibbled at by time and boredom. We require from the Secretary of State some evidence that he is prepared to do some-

thing positive to overcome NATO's weaknesses. Admiral Hill-Norton has spelt some of them out. There are serious deficiencies in NATO manning levels, reserve stocks, electronic warfare capabilities, air defence and anti-submarine warfare. The gap between NATO and the Warsaw Pact is widening to our disadvantage. Does the Secretary of State agree?
Given the superiority of Warsaw Pact manpower and their more effective capacity to reinforce, the admiral's view, that the Russians need only one man in a support role whereas NATO needs two, makes a mockery of a defence policy based ostensibly upon economy, but in reality upon expediency.
What is wanted is an AD75. That is a plan similar to AD70, which was instituted in 1968 after the invasion of Czechoslovakia. But AD75, if the Secretary of State would adopt it, would be a plan which, by taking inflation into account and increased operating costs, would initiate a programme of specialisation, rationalisation and standardisation. NATO needs to standardise its equipment. At present it operates 25 different types of aircraft and 15 different types of armoured vehicles.
Even more important than the standardisation of its equipment, it needs to standardise its logistics. Much greater effort is needed both in the establishment of reserve units—for reinforcement would be vital to NATO's success—and in the building up of the full logistic support necessary to deploy reserves in sectors where they would be most needed. NATO's real weakness lies in a lack of compatibility and inter-operability of its forces. The point is that as the forces of the various nations depend upon national lines of communication, and as their equipment, and often their doctrine, too, is not standardised, the supreme commander is unable to deploy them at the place of his choice.
The integration of command and control with operational planning has, as yet, no equivalent whatsoever in the field of logistics. This, in its turn, sets narrow limits on the flexibility of operational command and control.
In the past Labour's defence policy— and this is not the first of Labour's defence reviews; it is not, in fact, the


most radical of them—may be described as exercises designed not to betray but to deceive, to pull the wool over the eyes of one-third of its own political party. It was, after all, Mrs. Wilson who launched the fourth Polaris submarine. Perhaps today the motive behind the exercise is the same. But as reduction follows reduction, and as Russia grows stronger and the West is in a state of disarray, is there not a real chance that the Secretary of State may succeed not only in the deception of his friends but also in the betrayal of his country's interests?

9.38 p.m.

Mr. Tam Dalyell: When the hon. Member for Aldershot (Mr. Critchley) touched on the costs of education and social welfare in the forces, he raised a real and important question. I should like to ask my right hon. Friends on the Government Front Bench this question. How much of the defence budget can properly be put down to education and social welfare and, indeed, to the technology that goes with the civilian involvement with North Sea oil rigs and diving? I should be very grateful if that question could be answered by the Minister of State. I am sure the figures are readily available. It is a very clear question as to how much non-military expenditure can rightly be put down to the defence budget.

Mr. Mason: I should like to inform my hon. Friend that on hospitals, schools and housing the Defence vote carries £210 million.

Mr. Dalyell: That says a lot. But perhaps we could leave that subject.
I should like to reflect that, until my hon. Friend the Member for Edinburgh, Central (Mr. Cook) started speaking, any serving soldier of the British Army sitting up in the Public Gallery would have thought that the House of Commons was a very odd and strange place. If I were a serving soldier in the British Army, I should, regardless of any political views I held, think that the Members of Parliament might be discussing the subject of Ireland, because with the prospect of being posted there, perhaps for the third, fourth or fifth time, this would seem a

little less remote than Gan and all the other places we have visited today.
Last Thursday, in the aftermath of the Northern Ireland debate, a number of hon. Members, not all on the Government side of the House, said rather gloomily "Of course, you are right in suspecting that the Army presence in Ulster, far from bringing peace, actually makes the situation worse. But you really ought not to say this in the House of Commons, since it undermines the morale of the Army and encourages the IRA". It is precisely this kind of consideration which has kept some of us tight-lipped for two years or more, but now it renders no service at all to the country, to the Army or to Ireland to remain muted any longer.
Convention or no convention, it is just not credible that there is a solution round the proverbial corner, and the plea "Be patient. Wait a little longer. Give this or that a chance" that we have had from successive Front Benchers has worn too thin.
I think of the periods 1939–45 and 1969–75. The open conflict in Northern Ireland has now lasted, as my hon. Friend said, for nearly the period of the Second World War. How many of us who sat here on 13th October 1969 conceived in our wildest nightmares that six years later the Army would still be operating in Northern Ireland?
Dick Crossman's diaries will reveal, if and when they are published, that the members of the Cabinet not immediately concerned with Northern Ireland were assured that this was a three-month, or at the most a six-month, police operation. This is what they were told. It is perhaps ironic that the Member on this side of the House who possibly, with the exception of the Secretary of State, knew most, and certainly cared most, about the British Army was the one to challenge the Permanent Secretary at the Home Office, pleased with his handiwork and that of his Ministers.
In October 1969 to his credit George Wigg said to Sir Philip Allen "You have put them in. Now just tell me how you are going to get them out."
This was a problem that the Secretary of State was aware of, because in his


celebrated speech at Newcastle-under-Lyme on 24th April he said:
Pressure is mounting on the Mainland to pull out the troops—equally, demands are being being made to set a date for withdrawal, thereby forcing the leaders of the warring factions to get together and to hammer out a solution.
That is the most urgent defence issue of 1975.
I thought that it was bizarre and unreal for my right hon. Friend to mention Northern Ireland only once in passing in his opening address. If we are not careful, this country has the prospect of a 30 years' war on its hands. To some of us it is the IRA and not the Russians or the Chinese who present the most immediate threat. Any hon. Member who has seen the youngsters in Long Kesh or on the streets of Derry or of Belfast will not pooh-pooh that remark.
Before I utter another word I must put it on the record that the soldiers are involved in a most miserable situation and that most units have shown incredible restraint in the face of odious provocation. Again as my right hon. Friend said at Newcastle-under-Lyme—
Their restraint is remarkable—trying to maintain peace between the IRA, the Provisional IRA, extreme Protestants and other purely criminal activities that fester and grow in such a situation.
I echo that.
However, the awkward fact remains that soon after the troops were widely welcomed in 1969, the chemistry of the situation underwent a change, and for years now the soldiers have not been seen as "our British Army" but have been seen by many in Ulster as an alien English, Scottish and Welsh Army. It has become a "They and us" situation. It is quite clear from speaking to returning soldiers, if not to their officers, who are more discreet, that the Northern Irish have become as alien to any members of the British Army as were the Cypriots in the 1950s and 1960s and the Adenis in the late 1960s. Any idea of British soldiers being "our Army" for any extremists on both sides was scotched by the understandable, though not necessarily correct, decision not to send the Irish regiments to Ulster.
The truth is very distasteful. Our boys in uniform have become a focus for hatred, and a considerable number of men and women are waging what amounts to a

kind of holy war to get the "Brits" out. There is widespread sympathy for many who harbour the IRA, and there is an enormous fund of anti-English myth and legend, and perhaps some little fact— we have to admit it—as we have recently learned from the High Court.
Some half century ago, 72,000 British soldiers in Ireland failed against Michael Collins. Less recently, Cromwell, Straf-ford and Edward Plantagenet, full of what they doubtless thought honourable motives, met with bloodshed and catastrophe. I do not know why Ministers of either party, given the history of Ireland, think that they can do any better, because now the whole premise on which the Army is there—namely, to back up and buy time for the moderates—is shaky. There are fewer moderates than we like to suppose, and fewer still who have any real influence. The history of Ireland, if it tells us anything, tells us that extremes settle with one another.
For the reasons I gave on Thursday, I do not assume that there would be a blood bath if the Army were to withdraw, but I think that there will be considerable loss of blood if detention, and especially detention without trial, continues. However—and this is the fix that the Government are in—to let out men of violence, or suspected violence, who have been rounded up in the first place at the risk of the lives of troops would be intolerable if at the same time the House of Commons and the Government asked the British Army to stay.
We cannot have it both ways. I agree that it is absolutely impossible to ask that of soldiers. If we bring detention to an end and let people out of Long Kesh, it is impossible and, indeed immoral to ask the Army to stay, because the soldiers have been risking their lives to round up those men, and to let them out would destroy the morale of the British Army. Somehow this vicious circle has to be broken, because the uncomfortable fact is that as long as something approaching 3.000 Irishmen are in what are seen as English gaols, violence will continue.
I must refer, if briefly, to the remarkable and formidable speech of the Home Secretary. He said:
No Home Secretary can bind his successor. But in my view—and I speak with full consideration here—there is no prospect of


amnesties for those who have committed coldblooded and indiscriminate murder or maiming in this country. I do not recognise political excuses for crimes of that order. Those who have received long sentences should, in my view, serve them, whatever political settlements there may be."—[OFFICIAL REPORT, 11th December 1974 ; Vol. 883, c. 634.]
Well, he probably had to say this, did he not? I simply reflect that these people regard themselves not as criminals but as prisoners of war and it may go against the grain, but the alternative— this has to be said—may be conflict for the lifetime in public life of most of us here.
The exit would be inglorious, but, then, de Gaulle had to make an inglorious exit from Algeria. I would not interpret it as being craven or letting people down but simply, from the other aspect, facing reality. If we kept the British Army beyond the spring, we would be on an expensive hiding to nothing in terms of money and, much more important, on an expensive hiding to nothing in terms of human life.
I end—and I do not think that this is unfair, because I am one of his admirers —with a sentence again from the remarkable speech of my right hon. Friend at Newcastle-under-Lyme on 24th April. He said:
It just cannot go on—deep seated hatreds are germinating in young breasts—soon all the young people of Ulster will be filled with hate; hatred against their own kinsmen as well as our own forces.
It would be an abuse of the House if I were to repeat the detailed arguments that I was allowed to make 10 days ago in the Irish debate. I end by pleading with my right hon. Friend to think about a different and alternative strategy in Ireland, because until this is done we cannot meaningfully discuss the defence review.

9.50 p.m.

Mr. R. Bonner Pink: I do not wish to follow the hon. Member for West Lothian (Mr. Dalyell) into the labyrinth of Ulster, although I echo his tribute to the bearing and forbearance of our troops serving there.
I listened to the Minister's statement and read it carefully in the OFFICIAL REPORT. I have listened to the Minister again today. The Minister called his statement a defence review. It is nothing of the kind. A defence review should review our defence needs and our com-

mitments, and the balance and capacity of our forces. The statement does none of those things.
Will the Minister tell us whether, after these cuts have been made, we shall have balanced defence forces as a national entity, or whether they will be complementary to those of other NATO countries? Will he tell us to what extent consideration has been given to the types of ships, aircraft and tanks best suited to our needs and to our obligations? For example, the Navy is now engaged on anti-gun-running patrols off Ireland. Would not comparatively small, fast and simple patrol boats do this job better than the larger, more sophisticated vessels now being used?
In his statement the Minister told us what cuts were to be made. There are provisos that we shall consult our allies, and that is right. On 21st March the Minister said that the review would commence. On 3rd December he said:
We are today beginning our consultations with our allies in NATO."—[OFFICIAL REPORT, 3rd December 1974; Vol. 981, c. 1352.]
What happened in that eight months' interval? Why were there no consultations during that comparatively long period?
The Minister announced cuts and consultations. What form will those consultations take? What form can they take, and has he aready decided on them? I know that the Minister qualified that statement today, but definite figures are contained in the statement. What form can those consultations take, except a statement to our allies, "This is what we have decided, but we are prepared to discuss details."
This is not a defence review. This is a price review. It is the announcement of a compromise between the maximum cut the Minister can persuade the Services to agree to and the minimum cuts he thinks will satisfy his own Left wing. The Government have decided to peg defence expenditure at 4½ per cent. of the gross national product. If that is correct and they really mean it, they must restrict Defence Estimates to defence expenditure. Here I take up the point made by the hon. Member for West Lothian, who spoke about the expenditure on education for the forces.
Other Ministries must make provision in their Estimates and their expenditure


for items which are not truly defence items. There is the education of children of Service men. There is university education. There is technical training, training of apprentices, retraining for civil life, the health services, hospitals, doctors, nurses, and welfare services of every kind. The Royal Navy maintains surveying ships and services providing charts and navigational publications. The RAF produces its own publications and runs a weather service. The Army produces maps and even maintains roads. These and other services are provided by the forces, and they come under the heading of defence expenditure. But they are widely used by the public at large and they should be apportioned amongst all the Ministries according to their use.
In more detail the statement says that manpower is to be reduced by 35,000 compared with the strength in April. Will the Minister make it quite clear whether that means a reduction in the actual strength or in the establishment strength, because the two figures can vary considerably? Will the hon. Gentleman state categorically that these reduced figures will be adequate for all our commitments?
It has been the strategy for a long time to have small garrisons overseas with the capacity for rapid build-up from the United Kingdom or Germany. But RAF transport is to be reduced by half, one Marine Commando is to go, and no assault ships are to be built. I understood the Secretary of State to say that that policy has now been abandoned. What happens to those overseas garrisons? Are they to be sitting ducks for the first aggressor who likes to come along?
The Hong Kong garrison is to be maintained, but Gan is to go. Gan is the most important staging post for the Far East. Diego Garcia is a long way south. Can it replace Gan without seriously reducing the payload of aircraft? If Gan is to go and Diego Garcia cannot replace it, how is Hong Kong to be serviced? In any event, what is to happen to Gan? Will the installations there be destroyed, or will they be abandoned, for the first-comer to take them over, or will they be given to Russia? The Minister should tell the House what

is to happen to Gan, that most important position in the Indian Ocean.
What about the Gurkhas in Brunei? My right hon. Friend the Member for Worcester (Mr. Walker) emphasised that the battalion cost us nothing. The Secretary of State tried to explain the situation. I do not know whether he was confused, but he managed to confuse me. I hope that he will come clean and tell us the real reason for withdrawing the Gurkhas from Brunei.
About the only welcome news is that the Polaris force is to be maintained. Once again I plead for an increase in the force by one submarine. At present we have four submarines. All too often it means that with refitting and so on there is only one out of four in the operational zone. One more submarine—

It being Ten o'clock the debate stood adjourned.

Ordered,
That the Motion relating to Defence Review may be proceeded with at this day's Sitting, though opposed, until half-past Eleven o'clock. —[Mr. Donald Coleman.]

Question again proposed.

Mr. Pink: With five Polaris submarines we could have two in the patrol area the whole time. We would get a 100 per cent. effective increase in our force for a 25 per cent. increase in the fleet. These boats are getting old and obsolete. If we are to retain the Polaris force, what is the programme for replacing them with newer and more modern boats?
These proposals in the review are a danger to the safety of this country. The Government must know the danger of these cuts and of reducing our defences at a time when the Warsaw Pact countries are increasing theirs. I appeal to the Government to reverse these policies. If they are not prepared to do so I can only hope that our NATO allies will knock some sense into them when the consultations take place.

Several Hon. Members: rose—

Mr. Speaker: Order. We are now reaching the end of the debate. I have been trying to extract a little more time for back benchers by taking it from the time alloted to the Front Benches for the replies. I hope very much to be able to call four more speakers from the back


benches. That will mean an absolute maximum of 10 minutes per speech.

10.3 p.m.

Miss Jo Richardson: My hon. Friends and I who tabled an amendment were, naturally, disappointed that you could not find it possible to select that amendment, Mr. Speaker.
I would like to remind the House of the terms of that amendment. I trust I shall be forgiven for reading it. We have said that we decline to:
take note of the statement on the Defence Review on the grounds that in present critical economic circumstances it proposes an increase in real terms in arms spending on the £3,612 million estimate for 1974–75 made at the beginning of the year to £3,800 million in 1976–77; that it commits Great Britain for the next 10 years to spend a higher proportion of the gross national product on defence than any of our major western allies; that it fails to propose significant reductions in major weapon projects; that it leaves Great Britain to maintain unjustifiable commitments east of Suez for the next decade ; and that it fails to release real resources and skilled manpower to industries which directly boost our exports and economic growth".
We were bitterly disappointed that the defence review was not in line with the programme on which all of us in the Labour Party, including the Secretary of State for Defence, fought the last General Election. My right hon. Friend the Secretary of State has said that he believes that it fulfils the Labour Party manifesto commitment. But it is stretching credulity too far to say that so-called reductions of £300 million in 1975–76, £500 million by 1978–79 and £750 million by 1983–84 come anywhere near to meeting the arguments which the Labour Party put forward during the General Election. In real terms the review represents an increase in spending. What the Secretary of State has done is to trim off some of the fat which should have been trimmed away earlier.
I speak as a layman. I am not like many of the military strategists on the benches opposite who remind me of nursery days when one moves battalions here and platoons there. I am sorry to say that I do not understand these matters. However, I understand the expenditure side. It seems that we are cutting a battalion in Brunei—which I gather will not cost us anything anyway— and our forces in Mauritius and Gan, and making some reductions in Cyprus

and eventually in Malta, but nothing— and this is the important point—to speak of is being done in Europe. That is what is swallowing up the money. It is our contribution to NATO which is crippling us because it amounts to about 90 per cent. of our defence spending.
Why are we still maintaining Polaris submarines? Why are we maintaining British and American nuclear bases? They are not a deterrent. If they were I might be convinced. I believe that their existence actually represents a danger to people in this country. What is more, we have no real control over them. The Nassau agreement said that we could use them only in the most dire emergency. Otherwise their use will be a NATO decision. That means that we are committed totally to NATO plans and NATO targeting. But to what extent is NATO's targeting policy the same as that of its dominant partner, the United States, and to what extent are our weapons systems tied to American weapons systems?
I am sorry to hear that we are still committed to the MRCA. We are told that 385 planes are on order at today's prices, and they are about £4 million each. The Secretary of State said that we may slow down the programme. But does that not mean that in our present state of inflation we shall probably pay more for them in the end even if he phases their delivery over a longer period?
We are still proceeding with the through-deck cruiser programme. The cost of each cruiser is getting on for £1 million. Why are we cutting our research and development by only 10 per cent? We could cut it out altogether and buy what we needed from our partners.
We are reducing manpower by 65,000, plus 15,000 locally employed people. Why cannot we plan to cut more? Some of my hon. Friends have already shown that we could easily absorb more people into useful industries instead of putting them on the useless work that they are doing now.
Is it not time that we took a long cool look at NATO? The supposed reason for its existence is to defend us against the threat from the Warsaw Pact. I believe that that threat is vastly overstated. The Soviet Union, though I regret


that she spends so much of her resources and manpower on defence and requires her allies to do likewise, has far too much to lose to risk endangering her people and her economic future by involving herself in another war. However, even if the Soviet Union were involved in some kind of confrontation, would not we in Britain be first in line for attack because of our possession of nuclear weapons and Polaris and because of our position in NATO?
My personal view is that a genuine threat comes from NATO, and that in reality NATO is being used to prevent social change. We in this country should not be associated with that. Let us remember that NATO consists not simply of the countries of Western Europe but is dominated by the United States.
We have already seen the rôle of the CIA in Chile. I have no doubt that the CIA is carefully watching the changes which have taken place in Portugal. We may be sure that any hope of social change in Spain will be prevented by American influence. If it had not been for what I believe was a conspiracy between the United States and the Greek colonels, what happened in Cyprus might never have happened. The possibly antidemocratic nature of NATO should be

watched. I believe that the Common Market is an economic counterpart of NATO, supporting the same reactionary forces. That is one reason why I am opposed to it.
Should we not now be beginning to re-think our rôle in Europe and the world? We were once a great military Power. We have not been one for a long time, and it is time we faced that. We could be a great Power in an entirely different way. We should gain much more respect if we rejected our rôle of trailing behind the United States and NATO, and if we stood on our own, unhampered by pressures from outside. Then we should build a better Britain. We could use the resources which we so released to re-equip our run-down industry.
I thought that we were supposed to be in the middle of an economic crisis. We could spend more on social services, which hon. Gentlemen opposite are constantly telling us cost too much, and we could make a real contribution to the relief of world poverty and hunger, which are the real enemy of peace in the world.

Several Hon. Members: rose—

Mr. Speaker: Order. I am grateful to the hon. Lady for keeping to her time.

10.12 p.m.

Mr. Alan Clark: On all previous occasions when my right hon. and hon. Friends and I have questioned the Secretary of State and his colleagues on this topic we have been told to wait on points of detail for the publication of the defence review. The defence review is now upon us, but the elucidation of the details of expenditure, cost effectiveness and savings is remarkably obscure. For example, it is hard to relate the savings to the measures and cuts which are embodied in the review. As to the withdrawals which the Secretary of State proposes, how much individually will be saved by withdrawing from Gan, Mauritius and Brunei? It is hard to see how the proper discussions and consultations, which the Secretary of State promised, can be conducted if the individual figures attaching to these measures cannot be provided.
I go further and question whether the withdrawals are advisable at all. These stations are not truly "Imperial" in the old pejorative sense. They do not involve rule by an alien force against the wishes of a native population. They are pieces of strategically vital real estate. Real estate of that kind is vital for several military and economic purposes, not simply as supply bases but also for the protection of trade units, as dispersal points, missile tracking stations and so forth.
The House has lately been reminded of the importance of such pieces of real estate by the Falkland Islands, of which we might well have been tempted to divest ourselves, in spite of the expressed wishes of their inhabitants and in spite of their potential strategic advantages. Now it has been established that there is oil in their territorial waters, and they offer one of the most favourable platforms for the exploration of the mineral-rich Antarctic. How easily we might have disposed of the Falkland Islands some years ago to please the Argentinians, or even the Chileans in the days when they found favour with the Labour Party.
I ask the right hon. Gentleman to consider carefully the suggested withdrawals, because of all strategic decisions in defence planning, physical withdrawals

are the most difficult to reverse. Weapons programmes, recruitment and research can suffer harm, but need not be irreversible, given the will and the resources at a later date. But physical withdrawals from territory are final. I listened earlier with great interest to the hon. Member for Harlow (Mr. Newens), who spoke of the Middle and Near East. He might dissent from me on this point, but I do not believe that it is too much to say that the whole of the present oil deficit crisis, which troubles the Labour Party and the country, has its origins in the failure of nerve by the British Government in 1956 when they withdrew from Suez.
The function of defence policy, in conjunction with foreign policy, is to advance, nurture and protect the interests of the United Kingdom. This is its primary function. Obligations to alliances are important, but only where such alliances contribute to this essential purpose. Plainly, any alliance that takes precedence over the individual interests of the United Kingdom would cease to command any obligation.
I note that the right hon. Gentleman declared the intention to maintain his bias of strength in the centre and in harmony with the NATO alliance. But is there not a danger of becoming mesmerised by the strength of the Warsaw Pact forces to the detriment of the position which it is essential that the United Kingdom maintains if it is to preserve its trading capacity? Any collision in the central front on a major scale is bound to involve the use of nuclear weapons. Is this really a probability? In Hermann Kahn's phrase, no one will just "press the nuclear button and go home to tea." Far more likely must be rated the possibility of a conventional blockade either of the United Kingdom alone or of the United Kingdom and a part of western Europe by the Soviet fleet. To break or loosen such a blockade by the use of nuclear weapons would put the West in the position of an aggressor. To avoid this, it is necessary to have an adequate conventional capacity to resist such a blockade, at least for some weeks while negotiated positions are established.
This brings me to the subject of weaponry, the hardware with which the forces fight. The Secretary of State drew


attention to the rapidly increasing efficiency of the Russian navy. I have constituents in Plymouth who can remember the "Royal Sovereign" returning from being lent to the Soviet navy at the the end of the war. They remember the filthy condition in which it was returned, with no equipment working properly, the sights of the guns out of alignment and dirt all over the decks. These constituents now have sons who served in the Royal Navy and in Operation Northern Merger last September, they were shadowed for the whole duration of the exercise by a "Kriva" class destroyer. I know that some hon. Members on the Government side have a fraternal interest in the welfare and efficiency of the Soviet navy. They will be interested to learn that this destroyer was on good terms with the ships in the exercise and would converse with them over the signals system. On one exceedingly stormy night the admiral in command asked all ships under his command to signal details of the best speed they could maintain during the night, and various answers came back, of 12, 14 and 18 knots. When every ship in the fleet had sent an answer, the Russian Kriva destroyer signalled "28 knots," and it was serious. The most significant thing about this shadowing operation was that the "Kriva" destroyer never had to take on fuel throughout the exercise. The "Leanders" were taking on fuel every three days. What more vivid corrobora-tion could there be that in terms of quality the Soviet navy is now fast advancing to a state where it will be ship for ship, the most formidable in the world? [Interruption.] I am delighted that Labour Members should feel so concerned.
I should like to ask the Secretary of State and his colleagues questions about their accounting. The right hon. Gentleman says that weapons research is to be cut by 10 per cent. Is that qualitative or quantitative? Will he be axing some projects in their entirety, leaving others to their former budget, or is there to be a 10 per cent. cut across the board?
The hon. Member for Barking (Miss Richardson) suggested that weapons research should be cut out altogether. But it is the most important single sector of all defence expenditure if forward planning is to have any significance.
What would our predecessors—not just those who sat on the Government benches 59 or 70 years ago, but Clem Attlee's old Cabinet—have thought of priorities which gave free contraceptives to children under the age of consent and cut back on the essential requirements of the Royal Navy? [Laughter.] I have been in the House long enough to know that when Labour Members start laughing they are feeling uncomfortable. What would Clem Attlee's old Cabinet have thought of priorities which allocated revenue towards colour television sets for prisoners in preference to new reconnaissance vehicles for the Army? There is a fundamental difference in attitude on this question.
The Secretary of State has said that he will cut spending by a percentage of the GNP. What if the GNP should expand over the period in question? What if all the new workers' co-operatives and part-owned enterprises we are promised should lead to a great upsurge in the GNP? Will there be a restoration of some of the cuts? If, as is much more likely, GNP contracts, will the Secretary of State at six-monthly or lengthier intervals explain that still further cuts are needed, that still more mutilation of the Services is required? Will the reviews become more frequent as the GNP contracts?
When he made his statement the Secretary of State was pressed by my hon. Friends on the effects of the cuts on industry. He answered—but his voice noticeably tailed away—that the resources released would go into exports. Leaving aside the validity of the claim of resources being released, what causes the right hon. Gentleman to believe that such resources would automatically flow in that direction? I have heard of the free market philosophy, but that is very optimistic.
I know that Labour Members are touchy about whom they export arms to, but the armaments industry is one of our most important export industries. If the Government properly supported the armament industry and fostered its quests for contracts by those means of diplomacy and pressure employed by our competitors, and often by our allies, the industry would be even more successful. That is a much more effective way of directly fostering exports than simply by cutting into and mutilating the industry and hoping that the resources released


will find their own way into the export trade by some obscure alchemy of the free market.

Mr. Speaker: Order. I hope that the hon. Gentleman will remember my request for brevity. He has had 12 minutes.

Mr. Clark: I am obliged, Mr. Speaker. I am about to conclude.
The resources the right hon. Gentleman has promised to release are essentially human. What about the gunsmiths, drawing office technicians, armourers, electronic engineers and dockyard welders? Are they to learn new trades or variants of a trade? From heavy industry to a light technology and engineering, prosperity and defence are closely linked, and that link is, or should be, even more important in times of industrial recession. To meddle with one is seriously to jeopardise the other.

10.25 p.m.

Mr. John Lee: I do not think I shall follow the hon. Member for Plymouth, Sutton (Mr. Clark) on the after-dinner speech with which he has managed to entertain the House, except for one or two points. One may say that he must be the last surviving supporter of the Suez strategy of 1956. To that extent, he has a certain antique value to the House.
The hon. Member for Clitheroe (Mr. Walder), in a rather more serious speech, sang the praises of NATO, which prompts me to remind the House that if there is one thing that the NATO organisation has failed to do, it has been to save two countries that have been the subject of Soviet aggression since the war—Czechoslovakia and Hungary. It failed to do so for the simple reason that even those who were ruling this country at the time knew perfectly well that any attempt by us to intervene would result in a nuclear war in which we would be faced with complete destruction. The fact is that NATO's bluff was called long ago. It no longer serves any useful purpose for any of us to pretend that it serves a useful function.
All that one can say of the defence review, is that one looks for small mercies in it. There is something for those who, for the last seven years, have been anxious to get the Government to come back from east of Suez. Some

movement has been achieved in that regard. But it is still a very depressing situation at a time of unparalleled economic crisis, when not only is it true that those who are fair-minded realise that there has to be a considerable reduction in expenditure if we are not to go on enfeebling our economy, but the United States Defence Secretary, Mr. Schlesinger, a few weeks ago was prepared to concede that the nuclear deterrent was no longer a valid concept. If such a view was forthcoming from so unexpected a source, one would have thought that the Government would have considered the time had arrived to bring to an end the nuclear deterrent.
Because the Government have not done so, some of us are going to find ourselves in revolt tonight. My hon. Friend the Minister of State will probably have a lot of explaining to do. I do not suppose that anything he says will be sufficient to make us change our minds on the matter, but as he was one of those responsible some years ago for trying to secure the reversal of the Labour Party conference's successful anti-nuclear campaign, he will have an opportunity to see that many of us in the Labour Party still do not regard the battle of 1961 as being over. He will see that we are as committed as ever to the removal of the unilateral nuclear deterrent from this country. We regard its retention as madness, and, whatever the outcome of the vote tonight, will go on fighting until we have got rid of it.

10.29 p.m.

Mr. Peter Viggers: … once we cut defence expenditure to the extent where our security is imperilled, we have no houses, no hospitals, no schools. We have a heap of cinders."—[OFFICIAL REPORT, 5th March 1969; Vol. 779, c. 551.]
I am glad that the members of the "Shadow Opposition" on the Government benches are in their places to hear that graphic description of excessive defence cuts, because it was given by the present Chancellor of the Exchequer when he was Secretary of State for Defence. It proves that as Chancellor of the Exchequer he makes a first-class Secretary of State for Defence.
Yet the Labour Party conference in 1973 called for military spending to be cut by at least £1,000 million a year. Furthermore, Labour Party conference


resolutions in 1972 and 1973 opposed a defence policy based on the nuclear deterrent. There is no clearer example of the Labour Party conference's disregard for the realities of this world, and no clearer example of the country's good fortune in one respect at least— that the relationship between the Labour Party conference and the Labour Government is roughly the relationship between John Gilpin and his horse.
The truth of the matter is that the Government's freedom of action on defence has been severely circumscribed. Faced by demands for cuts, they have, nevertheless, had to pay regard to the world around us and to certain overriding commitments. They have had to observe our treaty obligations. They have had to observe the NATO commitment, and particularly the requirement for troops to be kept in Germany. There is the Northern Ireland commitment, which shows no sign of lessening. There is the continued need for a nuclear deterrent, and this is fulfilled quite inexpensively through the Polaris submarine fleet. There is the commitment, given before the General Election and before the rest of the defence review was announced, to keep open all four naval dockyards.
There is the need to safeguard employment in certain areas where major defence projects are under construction. This is not strictly related to the defence of the realm but it clearly remains an important factor in the Government's eyes. Finally, each of the Services has established its case to retain its prestige projects involving advanced technology at an expense commensurate with the level of the technology. The cumulative effect of these requirements, the validity of which the Government have been forced to recognise, has been to render it impossible to make cuts that are sound from an economic and a defence standpoint.
Faced by demands for a reduction in defence expenditure, demands that are in no sense based upon the needs of the defence programme, the Government have been forced to direct their cuts at the muscle of the Armed Services, and this will weaken our ability to respond in emergencies. If the review continues the proposals will drastically reduce the transport capacity of the Royal Air Force. They will reduce the number of con-

ventional submarines and conventional surface vessels in the Royal Navy. Afloat support will be cut by one third, and the ability of the Armed Services to man amphibious operations will be drastically reduced.
These cuts may all seem acceptable in time of peace, but the object of maintaining defence forces is to have a flexible capacity to deal with situations of disorder and unrest, as well as situations of limited and total war. The vital attribute we may lose is flexibility—the ability to respond to any one of a range of emergencies. Most of the sections of the Armed Services that are proposed for cutting have it in common that in time of peace they may seem dispensable but in time of emergency they would give that flexibility that we should be certain to need.
Before committing this country to his proposals the Secretary of State should look again at the employment implications of his plans. Unemployment is about to rise rapidly—just how rapidly is known to those involved in industry. The Secretary of State is proposing to contribute to this unemployment by direct cuts in jobs. He is proposing defence cuts that will affect the jobs of 75,000 people, 60,000 of whom will be in this country. These will include indirect redundancies through a reduction of purchasing of new equipment or the postponing of deliveries of equipment.
This loss of home orders the threatened equipment manufacturers— aircraft companies, shipbuilding companies, and so on—might be able to deal with were it not for the fact that approaching them steadily from the other side, impervious to arguments and logic, is the Secretary of State's right hon. Friend the Secretary of State for Industry, who is determined to nationalise these companies. He is doctrinally committed to achieve his purpose, and the implications of his action need examination.
Let us look at the example of warship manufacturers. Foreign purchasers-foreign Governments—at present have a choice of dealing with United Kingdom companies direct or through the United Kingdom Government. About 90 per cent. of foreign purchasers prefer to deal direct with United Kingdom companies, despite the security advantages which seem to be given by dealing through the


Government. If these companies were nationalised, the foreign purchasers would be forced to deal through the Government or through a Government agency. Another disadvantage of nationalisation would be that some foreign Governments may be prepared to deal with a British company, but not with the British Government, and vice versa.
The Labour Government's prejudices in their preparedness to sell to some countries and not to others has been noted in export markets and is damaging our trade. If warship builders were to be nationalised, there would undoubtedly be a loss of export orders. Moreover, British Government work is to be switched from commercial yards to the dockyards to keep them open, in accordance with their pledge given before the election.
What will happen to the excess commercial shipyard capacity? Will the Secretary of State for Defence come to the rescue of industry thus annoying the Left-wing "Shadow Opposition", by placing further ship orders for the Royal Navy to safeguard these yards from redundancy?
I suggest that this situation should not be allowed to occur. The right course is for the Secretary of State for Industry to confine himself to the major problems that he has and to keep away from creating problems in areas where there are currently no problems
I make the following positive proposals. First, the Government should reconsider the need for flexibility in our Armed Forces, and in particular look again at the need for retaining conventional forces capable of great mobility.
Secondly, the Government should give a new major impetus to reserve training and commitment. This must be the most cost-effective way of improving the broad range of our defence preparedness and capacity.
Thirdly, there should be the widest range of consultation on the defence proposals, particularly with industrial representatives and local authorities, to safeguard employment. Some areas will be hit particularly hard if the cuts are implemented in their present form. As there are grants to subsidise industrial activity in areas of traditionally high unemploy-

ment, I suggest that a special grant should be available to stimulate an early growth of industrial activity to compensate for defence reductions, if such there should be.
The Government should recognise that people who enter Government service, particularly defence, do so because, first, they are prepared to take a lower level of remuneration because they feel that they are entering a secure employment, and, secondly, because they have a sense of loyalty. Both ideas will be undermined and shattered if the Government now decide to make these people redundant. If the State is to do that, it is right that it should minimise the damage that it is doing.
Finally—the most important point of all—we have heard of this so-called defence review since March. We were frequently told how searching and fundamental the review was to be. Now that we have the interim results—subject to consultation—may we have a clear and positive undertaking that when decisions are implemented no other defence reductions will follow within the period covered by the review projections? Such an assurance will enable those in the Armed Services and ancillary activities to plan their careers with the knowledge of security, enable defence plans to be made with confidence and certainty, and show our allies and those who might work against us that this country understands the realities of defence in a potentially hostile world.

10.39 p.m.

Mr. George Younger: I think that probably all hon. Members are sorry that circumstances have meant that we are not having the two-day debate for which we hoped. I make no criticism of the Government for that, because it was our choice, and it is right, that that should be the position. On the other hand, we have had an extension, thanks to some wise guidance from you, Mr. Deputy Speaker, and Mr. Speaker, and many hon. Members have managed to take part.
One of the happiest occasions this evening has been a truly remarkable maiden speech by my hon. Friend the Member for Chichester (Mr. Nelson). I have heard a number of maiden speeches, but I cannot recall one with so much assurance and fluency. The whole House will look forward to hearing from my hon. Friend


again in our debates. With a name like his, it is very appropriate that he should have started in a defence debate.
Secondly, I should like—I think with the support of the House—to repeat, in a defence debate, something which cannot be said too often. That is how much we all admire the astonishingly good reputation and skilful execution of tasks carried out by our Armed Services. They have always had a high reputation. It has probably never stood higher in the world generally than it stands today. This reflects the greatest credit on all concerned in the Armed Forces.
Thirdly, I should like to mention in passing a subject which has not been dealt with very much in the debate— Northern Ireland. The hon. Member for West Lothian (Mr. Dalyell) raised this subject. He has great knowledge and sincerity in these matters. I listened to him with great interest. I am sorry to say that I could not agree with his main thesis. But I would add this to what he said. There are many people who have strong views about what the next course of policy in Northern Ireland should be. But from the defence point of view it is very clear that the job of the defence forces is to serve the policy of the Government generally. Our forces are doing that extremely well in the most appalling circumstances, and with great pride, to some extent, in doing such a difficult job so very well. I am certain that the vast majority of our troops who have been in, and are in, Northern Ireland, although finding it a very difficult and in many ways a distasteful job, do manage to find a satisfaction, of some sort at any rate, in the skill with which they do their job.
I welcome the debate and the statement which preceded it as the deliberate intention of the Secretary of State to give us the opportunity of commenting on his proposals in time—I think that these were his words—to influence the course of events hereafter. Both sides of the House hope very much that he and his Ministers will think very carefully about many of the things which have been said today, because we should like to see some changes in what he has proposed. We hope also that the Secretary of State will pay very close attention to the views expressed in the consultations which he will be having with our friends and allies all

over the world. He mentioned earlier in the debate the rather disappointed reaction of Mr. Schlesinger in the United States. The right hon. Gentleman may also have noted today the remarks of Dr. Luns, making it clear that he has a number of reservations about the right-ness of what the Government are proposing in this case.
I hope that these views will be taken into account. If these serious views should be the general reaction which the Government receive to this review, I hope that they will not be too proud at this stage to return in a month or so and say that they have made changes in the original proposals set out in the right hon. Gentleman's statement.
There were a number of things one could welcome in the statement. In particular, I welcome warmly the Government's decision, reiterated, to continue the Polaris submarines. This is an essential part of our deterrent. They know that it is. They are very wise to be maintaining it.
I am extremely glad that the MRCA is to carry on. Several hon. Members, on both sides of the House, have raised questions about more detail being required about the slowing down of the ordering programme. I hope that we shall have that detail before too long.
I was glad to hear that the through-deck cruiser programme is to continue. But we have not yet been told whether the programme is for two vessels or just the vessel which is being built. We should like more details.
I greatly welcome, as do many of my hon. Friends, the Secretary of State's strong words today about the need for the TAVR to be maintained and even strengthened if possible. He is right. There is great potential there for effective reserves which can stand us in good stead in unforeseen circumstances ahead.
I hope that the disappointment which I must express about the review will not come as too great a shock to the right hon. Gentleman. My disappointment arises from the approach he has adopted to his task. Time and time again in the past few months the right hon. Gentleman and his junior Ministers have said that this defence review would be quite different, that on this occasion they would look at our commitments all over the world,


that they would consider what was necessary, and that at the end of it all they would come back and say, "These are our commitments. We must do this. We are providing the money with which to do it."
I am sure that Ministers started with that intention, but, unfortunately, it has not turned out that way. Overshadowing the whole review has been the loudly voiced and wholly impracticable resolution carried by the Labour Party conference and the watered down version of it which was put into the Labour Party manifesto.
It is sad that we are now facing in many ways the same hotchpotch of proposals as the right hon. Gentleman was trying to avoid. He has once more had to start from the point of saying, "How can I save the money which the Labour Party manifesto requires me to save?" As the right hon. Gentleman himself said, that is not the way to tackle the nation's affairs.
I therefore question the right hon. Gentleman on the results of the review, all of which stem from the fact that he had to approach matters from the wrong end. That is why, though he has been able to tell us in outline many things that he wants to do, astonishingly he has not been able to tell us how he proposes to do them. One thing that I thought we should get out of this nine-month long review was a pretty good idea of how the Government proposed to do these things. If the right hon. Gentleman does not know how he is to make these changes, how they will turn out on the ground, and what he will lose by making some of the changes, I reach the inevitable conclusion that he has merely set out to do an arithmetical calculation of how much money he can save and that he must now sit down to determine how it will all work out.
How can the right hon. Gentleman say that he is cutting the RAF transport capability by one half and the personnel in the RAF by 18,000 without being able to tell us how our forces are to be transported in the future? He does not appear to know. Is it to be by chartering civilian aircraft? If so, how is that to be achieved? Are there to be some new measures whereby civilian aircraft can be chartered without notice? What is to

happen if something crops up like the recent crisis in Cyprus at the peak holiday period when every charter aircraft worth flying is flying people to holiday locations world-wide? Will extra Government powers be needed so that we can get extra aircraft without notice? This capability cannot be cut by half without something being provided in its place?
What about the reduction of 12,000 in the Army? It amazes me that we are apparently discussing such a large reduction in the number of personnel in the Army, yet in answer to Written Questions the Secretary of State has not so far been able to tell us who they are to be. He went a little further in his speech today and rather engagingly painted for us the picture that there was nothing very particular that he could tell us about the 12,000, that it was all to be worked out by his hon. Friend the Under-Secretary of State for the Army, who would trot round various Army units picking out a cook here and a storeman there and eventually they would all add up to 12,000. We have had nothing more concrete than that.
We are assured that no major units are to go. We are assured that the cuts will not affect our contribution in Northern Ireland. We are assured that the cuts will not affect our contribution to NATO, except in relation to the specific contributions announced for the flanks. Where are the 12,000 soldiers to come from? We are entitled to know that, and I hope that the Minister of State will tell us all tonight.
Then there is the strange mystery of the Gurkha battalion. The Secretary of State has twice been questioned in the House on this subject, once the other day and once this afternoon. His customary fluency has deserted him on this occasion, and I ask his hon. Friend to come a little cleaner with us this evening. What is the answer to this mystery about the battalion of Gurkhas? So far as I know, the men are very happy in their work, and it costs this country nothing whatever to keep the battalion in Brunei. Why are they being removed from there if it is not saving us any money? The right hon. Gentleman could give no answer to that question except to say that he wanted to use the same battalion in Hong Kong. If it will not save money, what is the purpose of the cut?
We are not told very much about the maritime reconnaissance aircraft, the Nimrod. We are told that there is to be no reduction in the home-based Nimrods, but that there are to be some reductions overseas. What are those reductions, and why are they being made?
Then there is the question of the NATO flank force, the mobile commando force at present covering the NATO flanks. As I understand it, the right hon. Gentleman is proposing to reduce this force so that it will be able to deal with only one of the flanks instead of both. We have not been told whether this means that it will be interchangeable, or whether as it is proposed that this force should be trained for winter warfare, as the right hon. Gentleman said in his statement, it will be more or less assigned to the northern flank. However, I know that it is reported that today Dr. Luns made it clear that if it affected the Mediterranean flank, the southern flank, of NATO, this was the strangest of times to be weakening our contribution to the southern flank protection of NATO. Has the Secretary of State forgotten all the difficulties at present over Greece's membership of NATO and the recent troubles in Cyprus? What is the answer, and why is this cut produced at this time? It does not seem to make any sense at all.
We want to know a lot more about how this force is to be transported. Again, the right hon. Gentleman seems to be starting to think about that instead of having been working it out for the past nine months.
I come briefly to the industrial effects of the defence review. My hon. Friend the Member for Gosport (Mr. Viggers) touched on this subject. I should like to know a lot more about how it is proposed to employ the four naval dockyards. I am delighted that the Government are not closing any of them, because I should not like to see any of them closed, but how is the right hon. Gentleman to keep them working with such large reductions in the fleet without creating redundancies among civilian workers elsewhere? Large amounts of repair work and so on cannot be transferred to the naval dockyards from civilian shipyards without putting those shipyards and, what is

more, civilian shipyard workers out of work in the process.
It has been suggested by some Labour Members that the dockyards could quote for the construction of oil rigs and so on, as if that were something that could easily be done by a naval dockyard without thinking about it. But what about the oil rig construction companies, Cam-mell Laird and others, losing the work that the dockyards get? How many people will be put out of work if the Royal Naval Dockyards take on this work?
The Government cannot avoid the consequences of their own defence review. If they are not putting out of work the 30,000 people in the dockyards, there will be a serious effect on employment in other parts of the industrial sector.
If the dockyards tender for outside work, on what basis will they do so? Will they be competitive? Will their costs be fairly assessed against those of possible competitors? How are we to know that the tenders they put out are fair as against other contractors trying for the same work? These questions have not been tackled, and it is time that the right hon. Gentleman or one of his Ministers answered or, dare I suggest—I shall probably regret this very much—is this a case when the Secretary of State for Industry will have to come in and tell us how he will control the use of the dockyards in this way?
In spite of the eight and a half months of gestation for this defence review, at this stage there is very little more information than could have been worked out on the back of an envelope by the right hon. Gentleman before the last General Election. The main burden of what the Minister has announced today must have been known very well indeed to him and to the Government long before the last election. The whole of this review was deliberately held back until after the election because the Government knew perfectly well that it was electorally unpopular.
The cat is now out of the bag. The Government, in consultation with many of our friends and allies who are mystified by what they are doing, will have to work out what it all actually amounts to. The whole picture suggests that this much-vaunted and most extensive and thorough


review of our system of defence ever undertaken, which the right hon. Gentleman is so proud of, is in grave danger—if he does not take a grip on it from now on—of becoming a botched-up defence review.
The Government inherited from the Labour Party conference an impossible commitment to reduce defence expenditure without recognising the real needs of Britain. This Government have discovered that they cannot do this without either fatally weakening NATO or reducing our ability to carry out essential British tasks such as that involved in Northern Ireland, or both.
To their credit the Government have shrunk from either course as a whole but have opted instead for drastic cuts behind the scenes which, while they do not hit the headlines today, will within five years have fatally weakened our ability to carry out three essential actions: first, to carry out our commitment to reinforce the flanks of NATO; secondly, to move our forces swiftly by air or sea to any area where our interests are threatened; and, thirdly, to provide a reserve of strength to meet the unexpected, which was a point very well made by my right hon. Friend the Member for Stafford and Stone (Mr. Fraser).
It is the duty of this House to alert the British people to the danger of what is being proposed in their name. We should remember that decisions concerning defence cannot easily or quickly be reversed once they are taken. On the contrary, decisions taken now will have their most telling effect five years or so from now. We do not, we cannot, know what threats we may face then. A sound defence policy, whoever is in charge of it, in any country at any time, must always provide some margin to allow for the unexpected.
The history of warfare and conflict is littered with examples of people who prepared for the wrong war at the wrong time. The Government, in this defence review, are fatally weakening their one insurance against being caught out the next time, which is the provision of an adequate reserve for contingencies capable of being switched around, capable of being moved to the point of conflict, able to deal with problems, difficulties and crises, of which the right

hon. Gentleman cannot now know and of which he cannot be expected to know now.
The main damage being done by this defence review lies in the reduction of our ability to deal with the unexpected. That is the first thing that can be said of many a defence review. When the British people find that a crisis blows up in five years or so, and there is an immediate need—whether it is for rescuing people, for intervening in some difficult situation at the request of our allies or perhaps even of the United Nations, when it is required for the British forces to do so—the right hon. Gentleman must, if he is wise, hope that he will not be obliged to say, "I am sorry but the British forces cannot go on the relief expedition" or whatever it is "because we do not have the troops, the resources or the transport to convey them there." The decisions taken now will render those consequences the inevitable result in four or five years' time. I hope that the right hon. Gentleman will not be in office, experiencing the consequences of his own actions.
This defence review will decimate our future ability to deploy adequate forces to meet any situation which may occur. For that reason we shall divide the House tonight.

11.0 p.m.

The Minister of State for Defence (Mr. William Rodgers): When the Opposition suddenly lost their enthusiasm for a two-day debate—and it was their choice and no one else's that we should not have one—I wondered what sort of justice we would do to my right hon. Friend's proposals in the shorter period left to us. My concern now, I admit freely, is not that we have failed to cover the ground —we have succeeded surprisingly well— but that in the time available I shall deal inadequately with the questions which have been asked in more than 20 speeches today. Certainly there are some matters which, to do them justice and to defer to the right hon. and hon. Members who have asked questions, I shall have to leave aside. I intend no discourtesy, and I shall write to the right hon. and Members concerned when it may seem appropriate—[Interruption.] I think it is better that I should write than that I should not write, and there are also some large issues—

Mr. Trotter: May I suggest to the hon. Gentleman that he answers Written Questions instead?

Mr. Rodgers: The hon. Member for Tynemouth (Mr. Trotter) has asked 94 Written Questions in the past week, and he has received answers to them all.
May I join the hon. Member for Ayr (Mr. Younger) in his felicitous remarks about the maiden speech of the hon. Member for Chichester (Mr. Nelson)? The hon. Gentleman's remarks were pleasant, thoughtful and very confident, and, like other hon. Members, I look forward to his further contributions to our debates,
In commenting on my right hon. Friend's statement, right hon. and hon. Members have wanted it all ways. Some have asked us, perfectly reasonably, to take full account of their views in formulating the White Paper. The hon. Member for Ayr did this. We have been pressed about consultations with our allies by the hon. Member for Clitheroe (Mr. Walder) and with those affected in industry by the hon. Member for Gosport (Mr. Viggers). We have been urged from both sides of the House to think again either of cuts recklessly planned, given our security requirements, or of cuts neglectfully forgone, given our economic situation.
I do not complain. On the contrary, this is consistent with the fact that my right hon. Friend's statement was concerned with proposals, and a White Paper is to follow. But it is illogical to see this as a debate which can influence policy— to ask the Government to take heed of what hon. Members say—and at the same time to object, as the right hon. Member for Worcester (Mr. Walker) did, to the lack of certainty.
"Mystery" was the word used by the hon. Member for Tynemouth. If details are missing, it is because there is still much time to decide, and if ministerial views are occasionally reserved it is because we want, as we have been asked, to listen and to consider. As my hon. Friend the Member for Hornchurch (Mr. Williams) said, it would have been so much easier to present a neatly packaged review with the i's dotted and the t's crossed, with an accompanying brief giving all the answers.
We have taken a bolder course. I had supposed that hon. Members were pleased to have a fuller statement of our proposals than they expected on 3rd December. I hope now that the House will be generous enough to see that openness on the part of the Government requires a matching response in flexibility from right hon. and hon. Members
In the past week we in the Defence Department have answered more than 200 Written Questions. That is a lot, even allowing for the 90-plus asked by the hon. Member for Tynemouth. We have tried in every case to be as forthcoming as possible. On a number of occasions we have given information to hon. Members which had not previously been made public. Between now and the publication of the White Paper we shall remain as helpful as possible, not only because we have a duty to the House but as a positive contribution to open discussion.
Many hon. Members on both sides of the House have expressed their satisfaction at the booklet we have produced for the convenience of hon. Members, giving basic facts about defence spending. The hon. and gallant Member for Eye (Sir H. Harrison) said that the Defence and External Affairs Sub-Committee of the Expenditure Committee, of which he is the distinguished Chairman, will see a role for itself in further consideration of the statement.
I ought not to encourage inquiries that place a considerable strain upon the staff in the Defence Department, to whom I would like to pay a special tribute, in which I know the House will join, in view of the particularly heavy burden of work which it has recently carried. But we shall do our very best to provide information to the Sub-Committee so that scrutiny may continue.
There were times last week, and I admit this to the right hon. Member for Worcester, when we were obliged to reply that a particular matter was still under consideration or that it was too soon to say what the detailed outcome of certain proposals made in my right hon. Friend's statement would be. I fully understand the concern of hon. Members, and this includes the hon. Member for Gosport, over matters affecting employment in their own constituencies and the human problems which this involves. We


shall do our best to help in every way we can.
Perhaps I could mention the Royal Ordnance factories, which have a special status and employ more than 18,000 people in 11 different locations, affecting the interests of a rather greater number of hon. Members. As I said in a Written Reply to the hon. Member for Bridgwater (Mr. King) the other day, I hope that the overall level of employment in the factories will not be seriously affected by the defence review. The factories have been particularly successful in winning overseas orders, and I have already been in touch with my right hon. Friend the Secretary of State for Energy and other colleagues, to draw to their attention the scope that may exist in the Royal Ordnance factories and in the Royal dockyards for carrying out work for civil customers. I hope that my hon. Friend the Member for Sheffield, Heeley (Mr. Hooley) will note that we have in mind the demands of the offshore oil industry.
Of course, there are problems, as the hon. Member for Ayr said. We are not claiming that they will be easy to solve. Surely it is right for the Government, if there is to be a decline in any of the establishments of Government, to seek additional opportunities for employment, wherever they may be. I would have thought that that view would commend itself to all hon. Members.
The proposals set out by my right hon. Friend on 3rd December represent the considered view of the Cabinet as a whole. But I am sure that any other group of 23 Members would reach conclusions different, at least in part. I would go further. If all hon. Members had a chance to sit in my right hon. Friend's chair I would expect 635 different solutions to the defence review. I know that some of my hon. Friends, including my hon. Friend the Member for Harlow (Mr. Newens), are bothered by Britain's involvement in Oman and attach rather less importance than the Government do to maintaining a small presence, at minimum cost, under long-standing obligations. I am sure my right hon. Friend the Secretary of State for Foreign and Commonwealth Affairs, whose responsibility it mainly is, will take note of their con cern. I note, conversely, that there are those in the House who wish that we

intended to retain a significant presence in Singapore. I confess that I have a certain wayward sympathy for their point of view.
As the House knows, I went earlier this year, when the defence review was in its initial stages, to Kuala Lumpur, Singapore, Canberra and Wellington to consult our partners in the five-Power arrangements. In our debate on 2nd July I said that all four Governments had made clear publicly that they would prefer us to remain. But we have had to consider how far our remaining commitment of some 2,500 men, the facilities they require and the means of sustaining them are relevant to our principal interests today. When we looked at this we concluded that withdrawal made sense. Our partners have shown understanding, and have welcomed our willingness to leave a handful of men—although, of course, no equipment and no aircraft—to help to run the integrated air defence system.
Our decision on Singapore has been reflected in our decision on Gan. I noted what the right hon. Member for Brighton, Pavilion (Mr. Amery) said about that. We shall be looking at the consequences of our decision to withdraw, but both decisions marry up with our further decision on Mauritius and our intention to negotiate an end to the Simonstown Agreement.
We are steadily continuing to withdraw from our military role east of Suez, not because we are blind to the existence and growth of the Soviet fleet, complacent about the prospects of stability or self-conscious about flying the flag. We simply cannot afford it, given the priorities we have set.
My hon. Friend the Member for Belper (Mr. MacFarquhar), in a typically lucid speech, made remarks which are relevant to this, and I commend right hon. and hon. Members on both sides of the House who were not present when he spoke to read what he said. It made a great deal more sense than did the old-fashioned remarks of the right hon. Member for Pavilion about a grand design.
There are other commitments round the world which we retain because of longstanding and inescapable obligations or because it makes good sense for wider reasons of foreign policy. No one has suggested in the debate that we should abandon Gibraltar or the external de-


fence of Belize as long as it is dependent upon us. No one has suggested either that the passionate wish of the Falkland Islanders to remain British should be lightly set aside. Similarly, it is not as easy as my hon. Friend the Member for Heeley suggested to dismiss our obligations to Hong Kong, although we intend to make some reductions in our forces and to seek from the Hong Kong Government a larger proportion of their cost. I agree that the need for this is urgent.
We should look at the decisions on Brunei in the light of our statutory obligations. We can argue whether it is right further to reduce our commitments east of Suez, but if it is right, if it makes sense in terms of priorities—and I sense that there is a larger understanding within the House than Opposition speeches suggested—we should look at our commitments as a whole and consider them as a piece.
As for Cyprus, we intend to make some early reductions in our forces stationed in the sovereign base areas, not because of the defence review but because of the need to relieve the present severe personnel overcrowding within the bases —for which there will be sympathy on both sides of the House. For that reason we shall begin to thin out our air forces early in the new year. These reductions, to meet the problem of overcrowding, are without prejudice to the outcome of consultations with our allies on the defence review to which my right hon. Friend referred in his statement of 3rd December.
I hope that, on reflection, the House will feel reasonably relaxed about these proposals, both when they mean breaking long-standing ties and when some further relatively modest obligations remain.
The same can be said of the Indian Ocean, where our agreement to a modest improvement of the support facilities at Diego Garcia at no cost to ourselves is quite compatible with our wish to see peace and stability in that area.
I hope that my hon. Friend the Member for Harlow will welcome what I am about to say. We shall continue to pursue consultations with the aim of developing realistic progress towards arms limitations in the Indian Ocean, about which a number of countries, notably Australia, have made constructive suggestions. This is because we support realistic arms con-

trols and disarmament measures which can contribute effectively towards peace.
East-West negotiations on mutual and balanced force reductions began in Vienna in October 1973, with the aim of providing undiminished security for both East and West at a lower level of forces. As the House knows, we cannot claim rapid progress, but the negotiations are complex and the talks have been businesslike and constructive. They should not be despised by anyone in the House, because both sides are seeking seriously for agreement. It is right that we should support the talks, and our support is evidence of the importance we attach to NATO as an instrument both of defence and detente. We hope that they will succeed.
It is too soon to speculate on the likely level of United Kingdom reductions in BAOR which might result from a successful agreement, but those who have asked whether the proposals we have made for defence spending over the next 10 years will survive, irrespective of changed circumstances, may assume that we shall act upon as well as welcome genuine progress towards disarmament at Vienna.
I have also been asked what on the contrary might happen if there were a significant deterioration of the world situation which, by common consent, increased the threat to British security and demanded urgent action. My answer is that I am certain that any future Government would act responsibly in the national interest, as has always happened at times of crisis.
I entirely take the point, which has been made several times, including by my hon. Friend the Member for Edinburgh, Central (Mr. Cook), that it is very difficult to predict the course of events over the next 10 years. Obviously that is true. However, we make certain assumptions for planning purposes over a period which, incidentally, represents almost the minimum span of time for the development and production of new items of equipment, or we make ad hocand short-term decisions with the severe penalties to which my right hon. Friend drew attention.
Of course the security situation may change either way, and of course GNP may rise faster than we have predicted, or more slowly. All these factors will


have to be taken into account if and when they change markedly from our present assumptions. The situation as regards defence is essentially no different from that of other major public programmes, except in so far as our decisions affect our position world-wide and our relations with our allies and our partners.
I am sorry if some of my hon. Friends feel that they have been misled by the figures for savings given by my right hon. Friend in his statement. I hope that they will acquit him of such responsibility. He said quite clearly that the savings he proposed should be set against the long-range estimates of defence expenditure we inherited.
I filled in the details in reply to the right hon. Member for Worcester on 9th December, in an answer that I hope in this case met with his satisfaction. Similarly, in answering my hon. Friend the Member for Salford, East (Mr. Allaun) on 11th December I made the point that savings can be measured only in terms of expenditure now envisaged compared with previous programmes. This is a public accounting convention that is well understood in the House, and makes good sense. It involves a comparison of like with like. I can remember many occasions on which we have debated cuts in public expenditure, and have deplored them from the Labour benches, in terms of a reduction in the rate of increase.
My hon. Friend the Member for Belper was right to suggest that those who believe that our savings will be "phoney" cuts should tell that to the 70,000 people who will become reduntant.

Mr. Frank Allaun: My hon. Friend is dealing with the basic question. I think that on reflection he will admit that they are phoney cuts if in real terms the expenditure is rising. He cannot have it both ways.

Mr. Rodgers: I am not inclined to have it both ways. My hon. Friend—I do not want to say it harshly—is asking to have it both ways when he refers to phoney cuts and refuses to accept that phoney cuts would not, and could not by definition, result in the level of redundancies that there will be, and the changes in the equipment programme that we have announced.

Mr. Ian Mikardo: Is it not time my hon. Friend and his colleagues stopped frightening us with the bogyman of redundancy? In two or three years after 1945 we cut the aircraft manufacturing industry from 2½ million to 200,000, and we took 5½ million men and women out of the Services and put them back into civilian employment, without a single person being out of work.

Mr. Rodgers: I would never attempt to frighten my hon. Friend. I was not suggesting, nor has my right hon. Friend the Secretary of State suggested, that we should forgo savings on defence expenditure because of the problems of redundancy. But it is no good pretending that we can have it both ways. If there are to be savings, there will be redundancies, and we should face up to them.
The hon. Member for Inverness (Mr. Johnston) referred in passing to fundamentalist views. There are three identifiable approaches to defence spending that rest upon indifference both to its level— it is always too much—and to getting value for money from it. There are those who believe that it is wrong to defend ourselves, those who believe that there is nothing worth defending, and those who believe that there is no one we need defend ourselves against.
The first group are pacifists. As my hon. Friend the Member for Hemsworth (Mr. Woodall) said, they occupy an entirely respectable moral position, provided only that their pacificism extends to revulsion at the bearing of arms by anyone anywhere. The second group are so cynical or disillusioned as to be unrepresentative of the people of this country, and I do not believe that they have any spokesmen in the House. As for the third group, who say that they cannot conceive of a threat to our way of life, they are either extraordinarily naive or extraordinarily hypocritical.

Hon. Members: Hear, hear.

Mr. Mikardo: My hon. Friend can see where his friends are.

Mr. Rodgers: Those in the third group are unrepresentative, and I am sure that no hon. Member would put himself in that category.
I return to the need to face up to the alternatives. If the items of spending


that we propose are not justified, how do we otherwise achieve the capability? If we do not need the capability, what are the explicit assumptions that lie behind its abandonment? I confess—I do so reluctantly—to finding rigorous analysis of these questions not always characteristic of those critics of my right hon. Friend who say that he is not going far enough.
Let us take the MRCA. In his statement my right hon. Friend said that we may have to make a reduction in the planned rate of delivery. I can say no more at the moment, because we shall be discussing this with our partners in the project. But were we to cancel the MRCA, as is sometimes proposed, we are entitled to ask, what would be put in its place? Are we to buy American aircraft? If so, which aircraft, and at what price? Are we to skip a generation of aircraft and rely on the existing Vulcans, Buccaneers and Canberras until they fall apart? Or does this not matter, and is the attack on the MRCA an attack on preserving the credibility of NATO itself?
I exempt from this criticism my hon. Friend the Member for Edinburgh, Central and others who have asked serious questions about alternatives to the MRCA, and particularly the aid defence variant. They are reasonable questions, and I would like the House to discuss them further. In this case the logic of the issues is being faced up to, and it is right that this should be so.
I return to the amendment that we are to vote upon. I concede that in recent years spending on defence has been overtaken by spending on social security, education and health. I go further: despite the remarks of the hon. Member for Aldershot (Mr. Critchley), I rejoice in the trend, and believe that it should continue. Twenty years ago defence spending was about one quarter of all public expenditure ; now it is 10 per cent. It is true that we are cutting our defence expenditure as a percentage of GNP from a figure higher than that of

our principal European allies. But 1 do not rest on that comparison, or on others. It is not what others spend, even within the alliance, which should finally determine our own decision. It is not even the claims—powerful, immediate, compelling—of this country's necessary social programme. It is a judgment, cool and considered, of what we need to spend to ensure our own security.

Of course, I understand those in this House who regret the passing of Britain's world role. I understand also the misgivings and private anxieties of those whose careers are affected by the review. I have said—perhaps too often and too moderately—that there is room for discussion. But I put it to right hon. and hon. Gentlemen on the Opposition benches that they do not serve the nation's cause by exaggeration ; on the contrary, to suggest, as they do in their amendment, that the country's security is imperilled, may be to feed the suspicions that they would otherwise wish to confound.

The right hon. Member for Worcester made a remarkable speech in his constituency a week ago. It was apparently mainly on matters other than defence— which is now the Opposition's custom. But the right hon. Gentleman found time to describe my right hon. Friend's statement as "a ghastly lapse" and spoke of disarmament and appeasement. I have already referred to disarmament. I hope that the right hon. Gentleman will choose the structure of his speeches and his words more carefully in the future.

Hon. Members on the Government side of the House are not ashamed to have a vision of a world free from war, but equally we are not prepared to surrender our freedoms, our values and our way of life to anyone who seeks by threat or by stealth to take them away. Our vision endures, but our proposals are based on a robust common sense.

Question put, That the amendment be made: —

The House divided: Ayes 256, Noes 316.

Division No. 35.]
AYES
[11.30 p.m.


Adley, Robert
Awdry, Daniel
Benyon, W. R. 


Altken, J. W. P.
Baker, Kenneth
Berry, Hon Anthony


Alison, Michael
Banks, Robert
Biffen, John


Amery, Rt Hon Julian
Bell, Ronald
Blggs-Davison, John


Arnold, Tom
Bennett, Sir Frederic (Torbay) 
Blaker, Peter


Atkins, Rt Hon H. (Spelthorne) 
Bennett, Dr Reginald (Fareh.) 
Body, Richard




Boscawen, Hon Robert
Hayhoe, Barney
Osborn, John


Boyson, Dr Rhodes (Brent)
Heath, Rt Hon Edward
Page, John (Harrow West)


Braine, Sir Bernard
Heseltine, Michael
Pattie, Geoffrey


Brittan, Leon
Hicks, Robert
Percival, Ian


Brotherton, Michael
Higgins, Terence L.
Peyton, Rt Hon John


Brown, Sir Edward (Bath)
Holland, Philip
Pink, R. Bonner


Bryan, Sir Paul
Hordern, Peter
Price, David (Eastleigh)


Buchanan-Smith, Alick
Howe, Rt Hon Sir Geoffrey
Prior, Rt Hon James


Buck, Antony
Howell, David (Guildford)
Pym, Rt Hon Francis


Budgen, Nick
Howell, Ralph (North Norfolk)
Raison, Timothy


Bulmer, Esmond
Hunt, John
Rathbone, Tim


Burden, F. A.
Hurd, Douglas
Rawlinson, Rt Hon Sir Peter


Carlisle, Mark
Hutchison, Michael Clark
Rees, Peter (Dover &amp; Deal)


Carr, Rt Hon Robert
Irvine, Bryant Godman (Rye)
Rees-Davies, W. R.


Chalker, Mrs Lynda
Irving, Charles (Cheltenham)
Renton, Rt Hn Sir D. (Hunts.)


Channon, Paul
James, David
Renton, Tim (Mid-Sussex)


Churchill, W. S.
Jenkin, Rt Hon Patrick (Redbr.)
Rhys Williams, Sir Brandon


Clark, Alan (Plymouth, S)
Jessel, Toby
Ridley, Hon Nicholas


Clark, William (Croydon, S.)
Johnson Smith, G. (E. Grinstead)
Ridsdale, Julian


Clarke, Kenneth (Rushcliffe)
Jones, Arthur (Daventry)
Rifkind, Malcolm


Cockcroft, John
Jopling, Michael
Roberts, Michael (Cardiff N.W.)


Cooke, Robert (Bristol W)
Joseph, Rt Hon Sir Keith
Rossi, Hugh (Hornsey)


Cope, John
Kaberry, Sir Donald
Rost, Peter (SE Derbyshire)


Cordle, John
Kellett-Bowman, Mrs Elaine
Royle, Sir Anthony


Cormack, Patrick
Kershaw, Anthony
Sainsbury, Tim


Corrie, John
Kimball, Marcus
St. John-Stevas, Norman


Costain, A. P.
King, Evelyn (South Dorset)
Scott, Nicholas


Critchley, Julian
King, Tom (Bridgwater)
Scott-Hopkins, James


Crouch, David
Kirk, Peter
Shaw, Giles (Pudsey)


Crowder, F. P.
Kitson, Sir Timothy
Shaw, Michael (Scarborough)


Davies, Rt Hon J. (Knutsford)
Knight, Mrs Jill
Shelton, William (Lambeth St.)


Dodsworth, Geoffrey
Knox, David
Shepherd, Colin


Douglas-Hamilton, Lord James
Lamont, Norman
Shersby, Michael


du Cann, Rt Hon Edward
Lane, David
Silvester, Fred


Durant, Tony
Langford-Holt, Sir John
Sims, Roger


Dykes, Hugh
Latham, Michael (Melton)
Sinclair, Sir George


Eden, Rt Hon Sir John
Lawrence, Ivan
Skeet, T. H. H


Edwards, Nicholas (Pembroke)
Lawson, Nigel
Smith, Dudley (Warwick)


Elliott, Sir William
Le Marchant, Spencer
Speed, Keith


Emery, Peter
Lewis, Kenneth (Rutland)
Spence, John


Eyre, Reginald
Lloyd, Ian (Havant)
Spicer, James (W. Dorset)


Fairbairn, Nicholas
Loveridge, John
Spicer, Michael (S. Worcester)


Fairgrieve, Russell
Luce, Richard
Sproat, lain


Farr, John
McCrindle, Robert
Stainton, Keith


Fell, Anthony
Macfarlane, Neil
Stanbrook, Ivor


Finsberg, Geoffrey
MacGregor, John
Stanley, John


Fisher, Sir Nigel
Macmillan, Rt Hon M. (Farnham)
Steen, Anthony (Liverpool)


Fletcher, Alex (Edinburgh N.)
McNair-Wilson, M. (Newbury)
Stewart, Ian (Hitchin)


Fletcher-Cooke, Charles
McNair-Wilson, P. (New Forest)
Stokes, John


Fookes, Miss Janet
Madel, David
Tapsell, Peter


Fowler, Norman (Sutton C.)
Marshall, Michael (Arundel)
Taylor, R. (Croydon NW)


Fox, Marcus
Marten, Neil
Taylor, Teddy (Glasgow C.)


Fraser, Rt Hon H. (Stafford &amp; St.)
Mates, Michael
Tebbit, Norman


Fry, Peter
Mather, Carol
Temple-Morris, P.


Galbraith, Hon T. G. D.
Maude, Angus
Thatcher, Rt Hon M.


Gardiner, George (Reigate)
Maudling, Rt Hon Reginald
Thomas, Rt Hon P. (Barnet)


Gardner, Edward (S. Fylde)
Mawby, Ray
Townsend, Cyril D.


Gilmour, Rt Hon Ian (Chesham)
Maxwell-Hyslop, Robin
Trotter, Neville


Gilmour, Sir John (East Fife)
Mayhew, Patrick
Tugendhat, Christopher


Glyn, Dr Alan
Meyer, Sir Anthony
van Straubenzee, W. R.


Goodhart, Philip
Miller, Hal (Bromsgrove)
Vaughan, Dr Gerard


Goodhew, Victor
Mills, Peter
Viggers, P. J.


Goodlad, A.
Miscampbell, Norman
Wakeham, John


Gorst, John
Mitchell, David (Basingstoke)
Walder, David (Clitheroe)


Gow, I. (Eastbourne)
Moate, Roger
Walker, Rt Hon P. (Worcester)


Gower, Sir Raymond (Barry)
Monro, Hector
Wall, Patrick


Grant, Anthony (Harrow C.)
Montgomery, Fergus
Walters, Dennis


Grieve, Percy
Moore, John (Croydon C)
Warren, Kenneth


Griffiths, Eldon
More, Jasper (Ludlow)
Weatherill, Bernard


Grist, Ian
Morgan, Geraint
Wells, John


Grylls, Michael
Morgan-Giles, Rear-Admiral
Whitelaw, Rt Hon William


Hall, Sir John
Morris, Michael (Northants)
Wiggin, Jerry (Weston-s-Mare)


Hall-Davis, A. G. F.
Morrison, Charles (Devizes)
Winterton Nicholas


Hamilton, Michael (Salisbury)
Morrison, Peter (Chester)
Wood, Rt Hon Richard


Hampson, Dr Keith
Mudd, Da vid
Young, Sir George (Ealing)


Hannam, John
Neave, Airey
Younger, Hon George


Harrison, Sir Harwood (Eye)
Nelson, Anthony



Harvie Anderson, Rt Hon Miss
Neubert, Michael
TELLERS FOR THE AYES:


Hastings, Stephen
Newton, Tony
Mr. Adam Butler and


Havers, Sir Michael
Nott, John
Mr. John stradling Thomas.


Hawkins, Paul
Oppenheim, Mrs Sally








NOES


Abse Leo
English, Michael
Upton, Marcus


Allaun, Frank
Ennals, David
Lillerick, Tom


Anderson Donald
Evans, Gwynfor (Carmarthen)
Lomas, Kenneth


Archer Peter
Evans, loan L. (Aberdare)
Loyden, Eddie


Armstrong, Ernest
Ewing, Harry (Stirling)
Luard, Evan


Ashley, Jack
Faulds, Andrew
Lyon, Alexander (York)


Ashton, Joe
Fernyhough, Rt Hon E.
Lyons, Edward (Bradford W)


Atkins, Ronald (Preston N)
Fitch, Alan (Wigan)
Mabon, Dr J. Dickson


Atkinson, Norman
Flannery, Martin
McCartney, Hugh


Bagier Gordon A T.
Fletcher, Raymond (Ilkeston)
MacCormick, lain


Bain Mrs Margaret
Fletcher, Ted (Darlington)
McElhone, Frank


Barnett Guy (Greenwich)
Foot, Rt Hon Michael
MacFarquhar, R.


Barnett, Joel (Heywood)
Ford, Ben T.
Mackenzie, Gregor


Bates All
Forrester, John
Mackintosh, John P.


Bean' Robert E.
Fowler, Gerald (The Wrekin)
Maclennan, Robert


Beith, A. J.
Freeson, Reginald
McNamara, Kevin


Benni Rt Hn Anthony Wedgwood
Garrell, John (Norwich S.)
Madden, Max


Bennett, Andrew (Stockport N)
Garrett, W. E. (Wallsend)
Magee, Bryan


Bidwell, Sydney
George, Bruce
Mahon, Simon


Bishop, Edward
Gilbert, Dr John
Mallalieu, J. P. W.


Blenkinsop, Arthur
Ginsburg, David
Marks, Ken


Boardman, H.
Goldlng, John
Marquand, David


Booth, Albert
Gould, Bryan
Marshall Dr Edmund (Goole)


Boothroyd, Miss Betty
Gourlay, Harry
Marshall Jim (Leicester)


Botlomley, Rt Hon Arthur
Graham, Ted
Mason, Rt Hon Roy


Boyden, James (Bish Auck.)
Grant, George (Morpeth)
Maynard, Miss Joan


Bradley Tom
Grant, John (Islington C.)
Meacher, Michael


Bray, Dr Jeremy
Grimond, Rt Hon J.
Mellish, Rt Hon Robert


Broughton, Sir Alfred
Grocott, Bruce
Mikardo, Ian


Brown, Hugh D. (Glasgow Pr.)
Hamilton, W. W. (Central Fife)
Millan, Bruce


Brown, Robert C. (Newcastle)
Hamllng, William
Miller, Dr M. (E. Kilbride)


Brown, Ronald (Hackney S.)
Hardy, Peter
Miller, Mrs Millie(Redbridge)


Buchan, Norman
Harper, Joseph



Buchanan, Richard
Harrison, Walter (Wakefield)
Molloy, William


Butler, Mrs Joyce (Haringey)
Hart, Rt Hon Judith
Moonman, Eric


Callaghan, Rt Hon J. (Cardiff S.)
Hattersley, Roy
Morris, Alfred (Wythenshawe)


Callaghan, Jlm(Middleton &amp;P.)
Hatton, Frank
Morris, Charles R.(Openshawe)


Campell, Ian
Hayman, Mrs Helene
Morris, Rt Hon John (Aberavon)


Canavan, Dennis
Healey, Rt Hon Denis
Moyle, Roland


Cant, R.B.
Heffer, Eric S.
Mulley, Rt Hon Frederick


Carmicheal, Neil
Henderson, Douglas
Murray, Ronald King


Carter, Ray
Hooley, Frank
Newens, Stanley


Carter-Jones, Lewis
Hooson, Emlyn
Noble, Mike


Cartwright, John
Horam, John
Oakes, Gordon


Castle, Rt Hon Barbara
Howell, Denis (B'ham, Sm H)
Ogden, Eric


Clemitson, I. M.
Howells, Geraint (Cardigan)
O'Halloran, Michael


Cocks, Michael (Bristol S.)
Hoyle, Douglas (Nelson)
O'Malley, Brian


Cohen, Stanley
Huckfleld, Leslie
Orbach, Maurice


Coleman, Donald
Hughes, Rt Hon C. (Anglesey)
Ovenden, John


Colquhoun, Mrs Maureen
Hughes, Mark (Durham)
Owen, Dr David


Conlan, Bernard
Hughes, Robert (Aberdeen N.)
Padley, Walter


Cook, Robin F. (Edln C)
Hughes, Roy (Newport)
Palmer, Arthur


Corbett, Robin
Hunter, Adam
Pardoe, John


Cox, Thomas (Wands, Toot)
Irvine, Rt Hon Sir A. (L'pool)
Park, George


Craigen, J. M. (Glasgow M.)
Irving, Rt Hon S. (Dartford)
Parker, John


Crawshaw, Richard
Jackson, Colin (Brighouse)
Parry, Robert


Crosland, Rt Hon Anthony
Jackson, Miss Margaret (Lincoln)
Pavitt, Laurie


Cryer, Bob
Janner, Greville
Peart, Rt Hon Fred


Cunningham, G. (Islington S.)
Jay, Rt Hon Douglas
Pendry, Tom


Cunningham, Dr J. (Whiteh.)
Jenkins, Hugh (Wandsworth)
Perry, Ernest


Dalyell, Tarn
Jenkins, Rt Hon Roy (B'ham, St)
Phipps, Dr Colin


Davidson, Arthur
John, Brynmor
Prentice, Rt Hon Reg


Davies, Bryan (Entield N.)
Johnson, James (Kingston, W.)
Prescott, John


Davies, Denzil (Llanelli)
Johnston, Russell (Inverness)
Price, William (Rugby)


Davies, lfor (Gower)
Jones, Alec (Rhondda)
Radlce, Giles


Davis, S. Clinton (Hackney C.)
Jones, Barry (East Flint)
Rees, Rt Hon Merlyn (Leeds S.)


Deakins, Eric
Jones, Dan (Burnley)
Reid, George


de Freitas, Rt Hon Sir Geoffrey
Judd, Frank
Richardson, Miss Jo


Delargy, Hugh
Kaufman, Gerald
Roberts, Albert (Normanton)


Dell, Rt Hon Edmund
Kelley, Richard
Roberts, Gwilym (Cannock)


Dempsey, James
Kerr, Russell
Robertson, John (Paisley)


Doig, Peter
Kilroy-Silk, Robert
Roderick, Caerwyn


Dormand, Jack
Kinnock, Nell
Rodgsrs, George (Chorley)


Douglas-Mann, Bruce
Lambie David
Rodgers, William (Teesside)


Dutfy, A. E. P.
Lamborn, Harry
Rooker, J. W.


Dunn, James A.
Lamond, James
Roper, John


Dunnett, Jack
Latham, Arthur (Paddington)
Rose, Paul B.


Eadie, Alex
Leadbitter, Ted
Ross, Stephen (Isle of Wight)


Edelman, Maurice
Lee, John
Ross, Rt Hon W. (Kilm'nock)


Edge, Geottrey
Lestor, Miss Joan (Eton &amp; Slough)
Rowlands, Ted


Edwards, Robert (Wolv. S.E.)
Lever, Rt Hon Harold
Ryman, John


Ellis, John (Brigg &amp; Scun)
Lewis, Arthur (Newham N.)
Sandelson, Neville


Ellis, Tom (Wrexham)
Lewis, Ron (Carlisle)
Sedgemore, B.







Selby, Harry
Thomas, Dafydd (Merioneth)
Wellbeloved, James


Shaw, Arnold (Redbridge, IIf.)
Thomas, Jeffrey (Abertillery)
Welsh, Andrew


Sheldon, Robert (Ashton-u-Lyne)
Thomas, Mike (Newcastle)
While, Frank R. (Bury)


Shore, Rt Hon Peter
Thomas, Ron (Bristol NW)
White, James (Glasgow, P)


Short, Rt Hon Edward (Newcastle C)
 Thompson, George
Whitehead Phillip


Short, Mrs Renée (Wolv NE)
Thome, Stan (Preston)
Wigley, Dafydd (Caernarvon)


Silkin, Rt Hn John (Lewish.)
Thorpe, Rt Hon Jeremy (Devon)
Willey, Rt Hon Frederick


Silkin, Rt Hn S. C. (Southwk.)
Tierney, Sydney
Williams, Alan (Swansea)


Sillars, James
Tinn, James
Williams, Alan, Lee (Haver'g)


Silverman, Julius
Tomlinson, John
Williams, Rt Hn Shirley (Hertford)


Small, William
Torney, Tom
Williams, W. T. (Warrington)


Snape, Peter
Tuck, Raphael
Wilson, Alexander (Hamilton)


Spearing, Nigel
Urwin, T. W.
Wilson, Rt Hon H. (Huyton)


Spriggs, Leslie
Wainwright, Edwin (Dearne V.)
Wilson, William (Coventry S.E.)


Stallard, A. W.
Wainwright, Richard (Colne V)
Wise, Mrs Audrey


Stewart, Donald (Western Isles)
Walden, Brian (B'ham, L'dyw'd)
Woodall, Alec


Stewart, Rt Hn Michael (H'smith, F)
Waiker, Harold (Doncaster)
Woof, Robert


Stoddart, David
Walker, Terry (Kingswood)
Wrigglesworth, Ian


Stott, Roger
Ward, Michael
Young, David (Bolton E.)


Strang, Gavin
Walkins, David



Strauss, Rt Hon G. R.
Watkinson, John
TELLERS FOR THE NOES:


Summerskill, Hon Dr Shirley
Watt, Hamish
Mr. James Hamilton and


Swain, Thomas
Weetch, Ken
Mr. Walter Johnson.


Taylor, Mrs Ann (Bolton W)
Weitzman, David

Question accordingly negatived.

Main Question put:—

The House divided: Ayes 241, Noes 58.

Division No. 36.]
AYES
[11.43 p.m.


Anderson, Donald
Dormand, Jack
Jackson, Miss Margaret (Lincoln)


Archer. Peter
Douglas-Mann, Bruce
Janner, Greville


Armstrong, Ernest
Duffy, A. E. P.
Jay, Rt Hon Douglas


Ashley, Jack
Dunn, James A.
Jenkins, Hugh (Wandsworth)


Bagier, Gordon A. T.
Dunnett, Jack
Jenkins, Rt Hon Roy (B'ham, St)


Barnett, Guy (Greenwich)
Eadie, Alex
John, Brynmor


Barnett, Joel (Heywood)
Ellis, John (Brigg &amp; Scun)
Johnson, James (Kingston, W.)


Bates, Alf
Ellis, Tom (Wrexham)
Johnston, Russell (Inverness)


Bean, Robert E.
English, Michael
Jones, Alec (Rhondda)


Beith, A. J.
Ennals, David
Jones, Barry (East Flint)


Benn, Rt Hn Anthony Wedgwood
Ewing, Harry (Stirling)
Jones, Dan (Burnley)


Bishop, Edward
Faulds, Andrew
Judd, Frank


Blenkinsop, Arthur
Fernyhough, Rt Hon E.
Kaufman, Gerald


Boardman, H.
Fitch, Alan (Wigan)
Kelley, Richard


Booth, Albert
Fletcher, Raymond (Ilkeston)
Kilroy-Silk, Robert


Boothroyd, Miss Betty
Foot, Rt Hon Michael
Lambie, David


Bottomley, Rt Hon Arthur
Ford, Ben T.
Lamborn, Harry


Boyden, James (Bish Auck.)
Forrester, John
Leadbitter, Ted


Bradley, Tom
Fowler, Gerald (The Wrekin)
Lestor, Miss Joan (Eton &amp; Slough)


Bray, Dr Jeremy
Freeson, Reginald
Lever, Rt Hon Harold


Brown, Hugh D. (Glasgow Pr.)
Garrett, W. E. (Wallsend)
Lewis, Ron (Carlisle)


Brown, Robert C. (Newcastle)
George, Bruce
Lipton, Marcus


Buchanan, Richard
Gilbert, Dr John
Lomas, Kenneth


Butler, Mrs Joyce (Haringey)
Ginsburg, David
Luard, Evan


Callaghan, Rt Hon J. (Cardiff S.)
Golding, John
Lyon, Alexander (York)


Campbell, Ian
Gourlay, Harry
Lyons, Edward (Bradford W)


Cant, R. B.
Graham, Ted
Mabon, Dr J. Dickson


Carmichael, Neil
Grant, George (Morpeth)
McCartney, Hugh


Carter, Ray
Grant, John (Islington C.)
McElhone, Frank


Cartwright, John
Hamilton, W. W. (Central Fife)
MacFarquhar, R.


Castle, Rt Hon Barbara
Hamling, William
Mackenzie, Gregor


Cocks, Michael (Bristol S.)
Hardy, Peter
Maelennan, Robert


Cohen, Stanley
Harper, Joseph
Magee, Bryan


Coleman, Donald
Harrison, Walter (Wakefield)
Mahon, Simon


Conlan, Bernard
Hart, Rt Hon Judith
Mallalieu, J. P. W.


Cox, Thomas (Wands, Toot)
Hattersley, Roy
Marks, Ken


Craigen, J. M. (Glasgow M.)
Hatton, Frank
Marquand, David


Crawshaw, Richard
Hayman, Mrs Helene
Marshall, Dr Edmund (Goole)


Crosland, Rt Hon Anthony
Healey, Rt Hon Denis
Mason, RI Hon Roy


Cunningham, G. (Islington S.)
Heffer, Eric S.
Meacher, Michael


Cunningham, Dr J. (Whiten.)
Henderson, Douglas
Mellish, Rt Hon Robert


Dalyell, Tarn
Hooley, Frank
Millan, Bruce


Davidson, Arthur
Hooson, Emlyn
Miller, Dr M. (E. Kilbride)


Davies, Denzil (Llanelli)
Horam, John
Miller, Mrs Millie (Redbridge)


Davies, Ifor (Gower)
Howell, Denis (B'ham, Sm H)
Mitchell, R. C. (Soton, lichen)


Davis, S. Clinton (Hackney C.)
Hughes, Rt Hon C. (Anglesey)
Molloy, William


Deakins, Eric
Hughes, Robert (Aberdeen N.)
Moonman, Eric


de Freitas, Rt Hon Sir Geoffrey
Hunter, Adam
Morris, Alfred (Wythenshawe)


Dell, Rt Hon Edmund
Irvine, Rt Hon Sir A. (L'pool)
Morris, Charles R. (Openshaw)


Dempsey, James
Irving, Rt Hon S. (Dartford)
Morris, Rt Hon John (Aberavon)


Dolg, Peter
Jackson, Colin (Brighouse)
Moyle, Roland







Mulley, Rt Hon Frederick
Rowlands, Ted
Wainwright, Richard (Colne V)


Murray, Ronald King
Ryman, John
Walden, Brian (B'ham, L'dyw'd)


Oakes, Gordon
Sandelson, Neville
Walker, Harold (Doncaoter)


Ogden, Eric
Shaw, Arnold (Redbridge, Ilf.)
Walker, Terry (Kingswood)


O'Halloran, Michael
Sheldon, Robert (Ashton-u-Lyne)
Ward, Michael


O'Malley, Brian
Shore, Rt Hon Peter
Watkins, David


Orbach, Maurice
Short, Rt Hon Edward (Newcastle C)
Watt, Hamish


Ovenden, John
Silkin, Rt Hn John (Lewish.)
Weetch, Ken


Owen, Dr David
Silkin, Rt Hn S. C. (Southwk.)
Weitzman, David


Padley, Walter
Small, William
Wellbeloved, James


Palmer, Arthur
Spearing, Nigel
Welsh, Andrew


Pardoe, John
Spriggs, Leslie
White, Frank R. (Bury)


Park, George
Stallard, A. W.
White, James (Glasgow, P)


Parker, John
Stewart, Rt Hn Michael (H'smith, F)
Whitehead, Phillip


Pavitt, Laurie
Stoddart, David
Whitlock, William


Peart, Rt Hon Fred
Stott, Roger
Willey, Rt Hon Frederick


Pendry, Tom
Strang, Gavin
Williams, Alan (Swansea)


Perry, Ernest
Strauss, Rt Hon G. R.
Williams, Alan, Lee (Haver'g)


Phipps, Dr Colin
Summerskill, Hon Dr Shirley
Williams, Rt Hn Shirley (Hertford)


Prentice, Rt Hon Reg
Swain, Thomas
Williams, W. T. (Warrington)


Price, William (Rugby)
Taylor, Mrs Ann (Bolton W)
Wilson, Alexander (Hamilton)


Radice, Giles
Thomas, Jeffrey (Abertillery)
Wilson, Rt Hon H. (Huyton)


Rees, Rt Hon Merlyn (Leeds S.)
Thomas, Mike (Newcastle)
Woodall, Alec


Roberts, Albert (Normanton)
Thompson, George
Woof, Robert


Roberts, Wyn (Conway)
Thorpe, Rt Hon Jeremy (Devon)
Wrigglesworth, Ian


Robertson, John (Paisley)
Tierney, Sydney
Young, David (Bolton E.)


Rodgers, William (Teesside)
Tinn, James



Roper, John
Tomlinson, John
TELLERS FOR THE AYES:


Rose, Paul B.
Tuck, Raphael
Mr. James Hamilton and


Ross, Stephen (Isle of Wight)
Urwin, T. W.
Mr. Walter Johnson.


Ross, Rt Hon W. (Kilm'nock)
Wainwright, Edwin (Dearne V.)





NOES


Allaun, Frank
Grocott, Bruce
Roberts, Gwilym (Cannock)


Ashton, Joe
Hoyle, Douglas (Nelson)
Roderick, Caerwyn


Atkins, Ronald (Preston N)
Huckfield, Leslie
Rodgers, George (Chorley)


Atkinson, Norman
Hughes, Mark (Durham)
Rooker, J. W.


Bain, Mrs Margaret
Hughes, Roy (Newport)
Sedgemore, B.


Bennett, Andrew (Stockport N)
Kinnock, Neil
Selby, Harry


Bidwell, Sydney
Lamond, James
SHIars, James


Callaghan, Jim (Middleton &amp; P.)
Latham, Arthur (Paddington)
Snape, Peter


Canavan, Dennis
Lee, John
Stewart, Donald (Western Isles)


Carter-Jones, Lewis
Litterick, Tom
Thomas, Datydd (Merioneth)


Clemitson, I. M.
Loyden, Eddie
Thomas, Ron (Bristol NW)


Coiquhoun, Mrs Maureen
McNamara, Kevin
Thorne, Stan (Preston)


Cook, Robin F. (Edin C)
Madden, Max
Watkinson, John


Corbett, Robin
Marshall, Jim (Leicester)
Wigley, Dafydd (Caernarvon)


Cryer, Bob
Maynard, Miss Joan
Wilson, William (Coventry S.E.)


Davies, Bryan (Enfield N.)
Newens, Stanley
Wise, Mrs Audrey


Edge, Geoffrey
Noble, Mike



Evans, Gwynfor (Carmarthen)
Parry, Robert
TELLERS FOR THE NOES:


Flannery, Martin
Prescott, John
Mr. Russell Kerr and


Fletcher, Ted (Darlington)
Reid, George
Mr. IanMikardo.


Garrett, John (Norwich S.)
Richardson, Miss Jo

Question accordingly agreed to.

Resolved,
That this House takes note of the Secretary of State for Defence's Statement on Tuesday 3rd December 1974.

DEFENCE

Motion made, and Question put forthwith pursuant to Order this day,
That the Army, Air Force and Naval Discipline Acts (Continuation) Order 1974, a draft of which was laid before this House on 30th October, be approved.— [Mr. John Ellis.]

Question agreed to.

MILK (PRICE CONTROL)

11.54 p.m.

The Minister of State for Agriculture, Fisheries and Food (Mr. E. S. Bishop): I beg to move,
That the Milk (Extension of Period of Control of Maximum Prices) Order 1974, a draft of which was laid before this House on 5th November, be approved.

Mr. Speaker: Order. Will hon. Members withdraw quietly and quickly?

Mr. Bishop: The purpose of the order is to extend for a further period of five years the power of the Minister of Agriculture, Fisheries and Food, or the Secretary of State for Scotland, to control the maximum price of liquid milk, and it is restricted solely to that.
At present, the Minister, acting jointly with the Secretary of State, lays down the maximum retail prices for Great Britain and, acting alone, the maximum retail prices for Northern Ireland. The statutory powers derive from Section 6 of the Emergency Laws (Re-enactment and Repeals) Act 1964, seting the renewal by Order in Council at intervals not exceeding five years. In 1969 Parliament approved an order extending the powers until 31st December 1974.
The need for retail price controls on milk has been recognised by successive Governments for nearly 35 years, and the reasons leading to that decision in the past will, I believe, be generally recognised today as being still valid. They have, indeed, taken on an even greater importance in the light of the fight to control inflation. But perhaps I may briefly summarise these reasons.
First, there is the special importance of milk in the national diet. We are, of course, a nation of milk drinkers, and milk constitutes one of the largest single components of the food price index. Secondly, there is the special nature of the marketing arrangements for milk, which over the years have become concentrated mainly in the hands of large concerns. At first hand level, sales of raw milk are made through the milk marketing boards, while the processing, bottling and distribution to the doorstep are to a great extent caried on by a relatively small number of large firms. This has made for great efficiency and high standards of hygiene.
Control of the retail price of milk is an essential part of the existing interlinked arrangements covering the guarantee to producers, the Government-controlled remuneration to milk distributors, and the assurance of reasonable prices to the consumer. These arrangements have worked well for the benefit of all concerned, ensuring stable conditions in this important sector of the industry. In addition, at present control of the retail price of milk is a means of implementing the decision to pay a consumer subsidy as part of the Government's strategy for controlling the prices of certain basic foodstuffs.
I make one further point. Many hon. Members are, I know, concerned about the return to milk producers. The level

of the return is determined by the decisions taken by the Government about the guaranteed prices and not by the level of retail prices. Having made the guaranteed price, the Government then have to decide whether the cost should be met by the consumer through an increase in the retail price, or whether there should be an element of subsidy.
Finally, the measures that we took in October to increase producers' returns by nearly 8p per gallon during the six months of winter showed the importance that we attach to ensuring an adequate return to our producers to enable them to meet the exceptional increases in costs. At the forthcoming annual review we shall be examining in detail with the fanners' unions all the factors affecting agriculture. For the reasons I have set out, we consider it appropriate to continue the Government's power to control the price of milk, and I therefore ask the House to approve the draft order.

11.59 p.m.

Mr. Robert Hicks: The order will give the Government authority to control the maximum price of milk for a further five years. In considering this matter I think it only right to remind the House that in dealing with the milk industry we are discussing an economic activity over which the Government maintain a very tight control. No other industry, not even in the nationalised sector, is under such control. This is nothing new. Control of some kind or another has existed since 1933, but surely that is not to say that this House should automatically renew this application for a further five years without first examining the current position, since in determining the maximum price the Government are setting the context into which the producers' incomes, and the distributors' margins and allowances, must be considered, as well as the final price paid by the consumer.
It is against that background that I should like to pursue three specific aspects inherent in the consequences of the acceptance of this order. The first concerns the period of five years. The Minister could clarify the position, since it appears that if there were a Government in office which were insensitive to changing circumstances, not only would hon. Members be restricted in the


extent of their representations but individual sectors of the milk industry could suffer unnecessarily. Why, then, is a period of one or two years not specified —or does the Minister wish to keep permanent control over this important industry?
My second question relates to the position of the producer. This is crucial, since his position at present is not a happy one. This confirms my earlier observation about changing circumstances and the degree of flexibility and sensitivity shown by the Government.
The milk output of the nation at present is significantly below its potential production level. Milk for the liquid market is at present limited, while there are real shortages of milk for the manufacturing sector. I do not need to elaborate on the adverse consequences of this situation on our balance of payments if it is allowed to continue.
I am certain that the House would welcome some indication of how the Minister envisages increasing the level of producer returns to provide a muchneeded stimulus to domestic production in the context of this order, which will enable him to fix maximum prices, particularly bearing in mind the rapid and steep increases in producers' costs and the recommendations contained in the report on milk production of the Select Committee on Expenditure, which was published recently.
My third request for additional information and clarification concerns the relationship between this order and the Government policy of subsidising the cost of essential foods to the consumer. I appreciate that the price of milk has a significant weighting in the retail price index and the index of retail food prices. I believe that an increase of lp on a pint of milk would increase the retail food index by nearly 1 per cent. It is only since 1972 that the Government have used their ability to fix the retail price of milk as an instrument of policy in attempting to reduce the rate of increase in the cost of living. As a result the milk fund incurred a deficit in 1972.
In his Budget speech, the Chancellor of the Exchequer announced that the retail price of milk was to be reduced by lp per pint, and, although since September, when the Council of Ministers agreed on an award to milk producers, the retail

price was increased by ½p per pint, it still means that during the current financial year, 1974–75, the estimated value of the subsidy to milk, will be of the order of £270 million. This, I should be grateful if the Minister could confirm whether this figure represents the total milk subsidy or whether there is a further latent subsidy in the form of a milk fund deficit. There could well be an overlap here of the use of the taxpayers' money, and we would welcome the Minister's clarification.
Above all, within the context of the order, the real practical problem is to provide a reasonable and consistent return for both producers and distributors and, at the same time, to charge a price to the consumer which is meaningful and yet will not reduce the overall level of demand for milk. It is not an easy equation to solve. But of one facet I am clear. Short-term price fixing at the expense of the producer will lead only to greater difficulties for the nation as a whole in the long term.

12.7 a.m.

Mr. Bob Cryer: I am grateful for this opportunity to comment on the order, and from the original Act of 1964 it provides very tight control by the Government. This is a very good example of how the Government can control an industry. It is necessary for the Government to do so, and it seems that the Opposition accept this degree of Government control. It is the kind of Government control which could well be extended.
I ask the Minister to ensure, however, that milk production is safeguarded and possibly increased. He might like to comment on this. Over the past two or three years milk producers have been going through a very difficult period, and I recognise that.
The Minister said that a lot of milk was distributed by large distributors. I want to pay tribute to the many small distributors who distribute milk, often under arduous conditions, and who find a degree of difficulty under price control in obtaining a sufficient margin to enable an efficient distribution service to be maintained.
The Minister pointed out that milk was an important food and one of the most important elements in the food


price index. I agree that it is a very important food, and that is why we control the price. But, in view of its importance, will the Minister consider extending the provision of milk at no price at all to 7 to 11-year-olds? Some members of the Labour Party fought vigorously in the past to provide milk for 7 to 11-year-olds. As it is such an important food, that is a possibility which my hon. Friend might consider.
I realise that there are difficulties about milk supply, but I ask for assurances about milk supply in the context of the control of prices—

Mr. Deputy Speaker (Mr. George Thomas): Order. We are not discussing milk supply as much as whether the price of milk shall be controlled.

Mr. Cryer: The Minister referred to milk supply, and therefore I felt it reasonable to enlarge a little upon it.
In the context of Government control over the industry and the very searching scrutiny that the Government impose under the powers inherent in the Act of 1964, this order is to be welcomed. Price control is part of the social contract. It is pleasing that the Government are acting to extend these powers for five years. I recommend my hon. Friend to convey to the Government the feelings of some of their supporters that this sort of price control should be extended on a much wider basis so that the powers in the Act may be used more effectively.

12.10 a.m.

Mr. Peter Mills: I welcome the opportunity to say a few words about the milk industry and the order. This is the second or third debate dealing with milk in which I have taken part during the past few years. Milk is one of the basic foods. It is a sensitive food politically. For my part of the country, the South-West, it is of vital importance. Everything that we do in this House has a profound effect on the milk industry. It is easy for Governments of all shades to bring various orders and regulations before us. Sometimes I do not think we fully realise the effect that they have on the milk producers and the industry generally.
This order sets out to control the maximum price to be charged for milk. For

the time being I agree with the Government, although I agree with my hon. Friend the Member for Bodmin (Mr. Hicks) in thinking that five years is too long. I should like the order to run for a year or two, and to see how the industry goes in the meantime. Certain results flow from a policy which controls the end price of a product. You may be thinking, Mr. Deputy Speaker, that some of us may be getting out of order, but I submit that there is a chain reaction when the price of a product is controlled, and it is right that we should discuss this.

Mr. Deputy Speaker: I had better make clear what my ruling is. Hon. Members must confine themselves to discussing whether the maximum price of liquid milk should continue to be subject to control. If the hon. Gentleman relates his argument to that, he will remain in order.

Mr. Mills: I shall try, and with your guidance, Mr. Deputy Speaker, I know that I shall be kept on the right lines.
This order will have a chain reaction. Have the Government taken into account the effect the order will have on producers? Will we get the milk required? Producers and retailers are kept within certain limits by the order. In a world of inflation, which means rapidly rising costs, unless producers and retailers can recoup their costs we simply will not get the milk required. It is no good setting a controlled price if we do not get the milk we need. Both the producers and the retailers are concerned that it seems as though people want milk but do not want to pay a fair price for it. If we want milk, the lesson to be learned is that costs will have to be met. If we control the price of the end product, there has to be some way of enabling retailers and producers to recoup their costs. Certainly, the country needs more liquid milk, butter and cheese. Factories demand a constant supply of milk, and I hope that the Government will ensure that there is an adequate supply.
What is the position in the industry today? There are many factories running on half production because of the fall in the input of milk. We come back once again to the cardinal rule that if we want the milk, however much we control the end price, we must see that there is recoupment, otherwise we shall not get the necessary supplies.
What does price control do to consumption? If we reject the order and milk is freed from price control, there will be a dramatic effect on consumption. The general public do not realise what a bargain they are getting in a pint of milk. It is still one of the best and cheapest foods. If there is no price control, costs will rise dramatically. But if there is price control the Government have to subsidise milk, and subsidisation distorts the whole pattern of the industry, milk consumption increases and there are insufficient supplies for manufacturing purposes. Will the Minister comment on that problem, which concerns producer, retailer and manufacturers?
I welcome the Minister's hint that he is concerned about the future of milk producers. I too am concerned. The Minister said that the Government are looking closely at costs in the industry and at the price review. I hope he will accept from me that if he wants milk the price review will have to be a satisfactory one.
What will happen to retailers if we accept the order? Their end price is controlled. Retailers and distributors are sometimes in extreme difficulty because of the tremendous rise in distribution costs. I wonder whether the public realise that the pint of milk on their doorstep represents the best milk distribution service in the world. I am full of praise for the Co-operative Society, Unigate, the Express Dairy and the smaller firms for the service they give to the public. But their end price is controlled and they as well as the producers must have a fair return to cover distribution costs. [Interruption.]

Mr. Deputy Speaker: Order. Interruptions from a sedentary position are no more welcome from the Front Bench than from the back benches.

Mr. Mills: Thank you, Mr. Deputy Speaker, though, with great respect, I am well able to look after myself.
This point is important. Perhaps the Minister of State can tell us about retailers and their costs and the fact that their end price is controlled.
I believe that the order represents the right course for the Government and I shall not vote against it, although some of my hon. Friends may well do so. But I hope that the hon. Gentleman will bear

in mind the points I have raised and will clearly tell us why he is bringing forward the order for a period of five years. There is a big question mark there, and the industry—retailers, producers and wholesalers—would like to know the reason.

12.21 a.m.

Mr. Nicholas Winterton: I have constituents involved in the production and distribution of milk, and I too ask why it is necessary to bring in the order for a period of five years. During the next two or three years we should, I believe, move towards a market price for milk. It is intolerable, when the Chancellor of the Exchequer says that the nationalised industries should stand on their own feet, particularly the energy industries, that milk should be heavily subsidised, to the detriment not only of the producer but also of the distributor. What is the total cost to public funds, in the milk fund and the direct subsidy, of keeping the price of milk as it is? As has been said, there could well be liquid milk shortages next year, and that forecast is substantiated by information from my constituency.
At the General Election in February I openly advocated a rise in the price of milk by at least one penny a pint. In my constituency there was no objection to it. I believe that the public realise the excellent bargain in a pint of milk. The delivery of a pint of milk to one's home each day is more reliable than the postal service. Probably we shall soon be paying 5p or 5½p per letter which is not guaranteed to be delivered next day. But milk is delivered to the doorstep every day.
The Minister should seriously consider in the next year or so phasing out the heavy liability of the taxpayer for milk subsidy and work towards a proper market price. It is important that that should be put on record at this stage.
I shall not vote against the order. I give it my support. It is right, however, that we should express our concern at the continuation of a very heavy subsidy for milk, and I hope that the present Government, and certainly the next Conservative Government which will not be too long in coming to office, will move towards a market price for milk, thereby producing a situation in which we get the milk we need and the producers feel that they are getting a fair return.

12.25 a.m.

Mr. Jerry Wiggin: Like my hon. Friend the Member for Macclesfield (Mr. Winterton), I am on record as having made it clear just over 12 months ago that it would have been wise and right then to increase the retail price of milk, and thereby enable the farmer to have up to 8p a gallon extra for his product. We all know why that decision was not taken. We understand why the then Government were reluctant to do what I proposed. It is true that in the price review that followed in February—it was brought forward because of the election —the money was provided to the farmers and paid retrospectively.
The order raises a far bigger question than just the specific regulation to control the retail price of milk. It raises the whole question of whether we should subsidise foodstuffs at all. It goes further and encompasses the question whether marketing boards should be given the responsibility for the control of production and their relation to supply and price.

Mr. Deputy Speaker: The hon. Gentleman is beginning to wander. This is a narrow order, and my job is to see that the hon. Gentleman keeps to the straight and narrow path.

Mr. Wiggin: I take your point, Mr. Deputy Speaker, but the only agricultural product with a fixed retail price by order is milk. The order deals with that, and therefore it is surely within its terms to discuss the philosophy behind it. That is what I was trying to do, but I shall try to remain within your strict injunction.
The dairy industry is the main plank of farming in Somerset. A decline in the industry, whether from a fall in calf and cull cow prices or in the liquid milk price, is a crucial matter to the prosperity of the whole of our agricultural world, going a great deal further than the boundaries of the county.
My hon. Friend the Member for Devon, West (Mr. Mills) mentioned the chain reaction of Government control of the price of milk for electoral or other reasons without the prosperity of the dairy industry. As a farmer for most of my

working life, I can only say that when Governments have had this power they have inevitably turned to the balance of votes and have seen that there are 55 million consumers and 300,000 farmers.
Tonight we are entitled to direct our attention to the farmers and their prosperity. I find the order nothing like as acceptable as do my hon. Friends. It is wrong to single out one agricultural product, however vital. Why should this product above all be singled out for strict control? I understand that the Minister's party has chosen to subsidise many foodstuffs, but that is a policy unacceptable to my party. Therefore, I am a little surprised at the reaction to the order from my side of the House. If the Minister does not give satisfactory answers, I shall not be able to support the order.

12.29 a.m.

Mr. Giles Shaw: I support my hon. Friend the Member for Macclesfield (Mr. Winterton) in drawing attention to the fact that milk at 5p a pint is ludicrously cheap compared with many other items that the consumer has to buy. It is particularly cheap compared with the 4½p and possibly 5p post, which suggests that the price of milk, with all its goodness and nutritional value, is only about ½p when delivered to the consumer's door.
Contrary to the marketing concept that the Minister wishes to establish, the consumer of liquid milk should recognise its value and pay a fair price. That price should allow an adequate margin for the wholesaler, retailer and ultimate producer. The first point to be made is that at 5p a pint of milk is far too cheap.
The second point, in relation to the subsidy, is that when we discussed in the Committee considering the Prices Bill those foods which might be suitable for subsidy, it was the Government's view that they would select foods which were inelastic in demand. Yet in relation to milk and the subsidy that has been levied on that product in the past months, I am led to believe that the demand—this is according to one of the major dairies with which I was in contact—has risen by 3 per cent. or 4 per cent., which is exceptional in relation to the dairy's recent past. It suggests that keeping the price artificially low stimulates demand, as one might expect, and this leads to problems


within the agriculture industry. When the Minister seeks to obtain provision for five years he should recognise that the problems of supply and demand cannot be set on one side against the possible reaction by the consumer.
The third point concerns the question of length of time. It seems to me that when one discusses food subsidies—I appreciate your ruling, Mr. Deputy Speaker, that this is not a debate on the principle, but that must surely follow in due course—one cannot take them in isolation from the general inflationary context. When one hears that the price of a commodity is held to within 4p, 5p, or even 6p or 7p in relation to the current rate of inflation and the depreciation of our currency, one must believe that that commodity will appear, by contrast, increasingly cheap and therefore of increasingly lower and lower value in real terms.
The consumer will judge the commodities she buys by the real value of the money she has in her purse. If she finds that a food, albeit a nutritional food such as milk, has become very cheap in relation to other commodities which she values equally highly, she is bound to set considerably lower store by that product, and the distortion therefore becomes so great that the Government find it almost impossible to remove.
With a valuable product like milk, the Government should take not a long-term but a short-term view. They should take a realistic view in relation to demand, in relation to the price charged in comparison with other commodities and in relation to the demands of the producer and the distributor of this vital product.

12.32 a.m.

Rear-Admiral Morgan-Giles: I wish to raise only one point, which has not been raised so far. Before doing so, however, I should declare an interest as a milk producer. I ask the Minister whether he realises that by continuing the order he is perhaps not perpetuating but ensuring the continuation for a long time of the difficulties affecting small producers. The big man has difficulties, but he has a lot of land. He has kale planted and he can somehow feed his cows. But the small man, with no land and only a small herd, must buy foodstuffs and he is placed in great difficulties.
I hope that the Minister realises this and will take it into account when implementing the order.

12.33 a.m.

Mr. Bishop: We have had a useful debate. I hope that I can stay within the terms of the order in making some replies.
There seems to be some contradiction among hon. Members on the Opposition benches about whether the order should be supported or whether it should be changed. The fact remains that similar orders have been presented to the House for about 35 years under successive Governments.
The only thing that we are debating in the order is whether we should continue with price control. Various questions have been raised by hon. Members opposite, particularly the hon. Member for Bodmin (Mr. Hicks). I thought that he put some responsible questions, and I shall try to answer them.
The question of the duration of the order has been causing some concern. The Minister and the Secretary of State for Scotland fix maximum retail prices for milk by orders made under Section 6 of the Emergency Laws (Re-enactments and Repeals) Act 1964. That section of the Act was due to continue in force until the end of 1969, but its operation was extended until 31st December of this year by the Milk (Extension of Period of Control of Maximum Prices) Order 1969. I would point out that the powers under the legislation are such that the Act may be extended for a further period of not more than five years by a similar Order in Council, subject to approval by resolution of both Houses.
The existing milk orders prescribe maximum retail prices for various types of liquid milk, and the powers in the enabling Act are permissive, not mandatory. If the Government wish at any time to disband or abolish control over any or all milk prices, this could be done. It is a permissive and not a mandatory order. If there were to be a substantial change, so that control was no longer necessary, the Government could at any time abandon that control by the existing milk price orders, or they could allow them to lapse without replacement.
It is important, incidentally, to have the possibility of a longer period, because such duration can give greater confidence


to the industry. At a time when we are reminded about the lack of both confidence and long-term assurances, the fact that we have power to go on without, at this stage at any rate, any intention to change the situation is reassuring and welcome to the industry.
The hon. Member for Devon, West (Mr. Mills), the hon. Member for Bodmin and other hon. Members spoke about the profitability of milk production. This is the essence of getting the quantities of milk we need. The measures that the present Government took in October had the effect of increasing the returns of milk producers by 8p per gallon—I had better be precise and say 7·7p, in case I am accused of exaggerating —over the winter months October to March. They took into account the high cost of feeding stuffs and the present low returns on cull cows and calves, and the more recent measures taken for beef may give additional help here. The October award was worth over £100 million. This is a direct injection into the dairy industry towards giving it much greater confidence, and this was justified. It should help reverse the decline in milk production and put dairy farmers in a position to expand their production.

Mr. Hamish Watt: Can the Minister give an assurance that the 7·7p increase will continue after February? It is essential that the dairy farmers should know now what is to be the price next year, to enable them to work out their breeding programmes. Already there are far too many in-calf cows going to slaughterhouses that should be retained for spring, summer and autumn supplies of milk next year. It is essential that producers, who will be working out mating programmes in the next few weeks, know what the price is likely to be in a year's time.

Mr. Bishop: I am sure that the hon. Gentleman would be rather surprised if I were now to give him the information he seeks. He claims, I think, to speak for the industry, or at least for those whom he represents in his constituency. We are holding detailed discussions with the industry, with the NFU, and what the hon. Gentleman raises will be a matter for consideration in the price review. I take

the hon. Gentleman's point. The Eighth Report of the Expenditure Committee has now recommended 8p per gallon and I am glad that we are able to accede to that recommendation.
The 1975 Annual Farm Price Review which is about to start will involve a detailed examination of all the factors affecting the dairy industry. It is not possible to anticipate the determination, but the points that have been made in the debate will be borne in mind. We must have regard to the factors which affect this industry, and I can give an assurance that we shall not be lacking in that respect.
The present system of price control is an essential part of the guarantee arrangements and the consumer subsidy. Before the introduction of the subsidy, successive Governments had fixed the retail price at a level which ensured that, taking one year with another, the consumer would meet the cost of the guarantee to producers as well as distributors' margins. Currently the price is fixed at a lower level and the balance is made good by the consumer subsidy.
The hon. Member for Bodmin asked about the fund. The guarantee is to milk marketing boards acting on behalf of milk producers. The essential feature is a guaranteed price for a standard quantity currently representing virtually all the milk produced. Until recently it has been the policy of successive Governments to set the retail price at such a level that, taking one year with another, the liquid milk consumer met the full cost of the guarantee as well as the margins for distribution.
The order is not directly linked with the subsidy that is being paid on liquid milk, although it provides the basis for imposing the maximum retail prices and thus helps to ensure that the consumer receives the benefit of the subsidy. The Government have brought relief from rapidly rising food prices by introducing subsidies on a number of basic foodstuffs. Milk was an obvious choice for subsidy as it is regularly purchased by most households and is particularly important to families with young children and to old people.
It is rather odd to hear Tory Members talking about milk being ridiculously cheap and the cost being far lower than


it should be, because at both the last election and the one in February all parties pledged to take action on the cost of living. I am not sure of the current value of the food subsidies, but until recently it was at least 65p a week for the average family of four—that is, a man, his wife and two children. If the subsidy was not paid the cost of milk would rise and it might be that millions would go through the threshold much sooner and thereby add to the inflationary situation, I therefore feel that the subsidy, with other food subsidies, is justified.
I think I have answered all the questions that were asked. We recognise that the price of milk is a bargain. This commodity is cheaper now than it was when we took office in March, and a tribute should be paid to producers and to the milk marketing boards for a situation that is without parallel, for the work that has been done in producing the milk that is so essential to our community and for the efficient way in which the milk is made available to those who need it.

Mr. Cryer: I accept all my hon. Friend's arguments about the value of milk. Will he comment on my suggestion that because of its nutritional value and the importance of price control it would be a useful exercise to consider the restoration of free school milk to 7 to 11-year-olds?

Mr. Bishop: I was about to come—

Mr. Deputy Speaker: Order. If the Minister ventures to answer that question he will go beyond the scope of the debate.

Mr. Bishop: I was about to come to the point made by my hon. Friend in his tribute to the small man. Apart from the work done by the big men, the small men all over the country perform an important service.
I should not be in order if I were to answer my hon. Friend's question about free school milk, but if I were to deal with it I should say that it did not come within the terms of the order.

Mr. Deputy Speaker: That is all right.

Mr. Wiggin: Before the Minister sits down, may I ask him to deal with the important point I made? On what ground does he justify singling out milk for Government control in this way?

Mr. Bishop: I think most people agree that milk is basic to all households. It is therefore an essential part of the food budget. If milk was not subsidised, the cost would be much greater and the inflationary spiral made greater by increasing wage demands in that direction.
The hon. Member for Weston-super-Mare (Mr. Wiggin) asked about the milk fund. From the retail sales of milk we get 51 per cent. of the price, from the sales of milk for manufacture within the standard quantity we get 22 per cent. and the subsidy represents 27 per cent. Therefore, without that subsidy the cost of milk would be much higher.
I hope that the House will accept the order, which gives power to control the price of milk for a maximum of another five years.

Mr. Winterton: Before the Minister sits down, may I put one question? Seemingly the order will be passed tonight. I am glad that it is not mandatory and that it allows the Minister discretion. May I ask for an assurance that the heavy rise in transport costs, particularly fuel and oil, facing distributors and producers will be fully recognised in any award that is made next year?

Mr. Bishop: I think I can give that assurance. That is a matter for the Milk Marketing Board in addition, but I am sure that the Government will bear these factors in mind in the forthcoming price review.

Question put and agreed to.

Resolved,
That the Milk (Extension of Period of Control of Maximum Prices) Order 1974, a draft of which was laid before this House on 5th November, be approved.

ADJOURNMENT

Motion made, and Question proposed, That this House do now adjourn.—(Mr. Pavitt.]

BAKERLOO LINE

12.47 a.m.

Mr. Hugh Dykes (Harrow, East): I am grateful for the opportunity of catching the attention of the House briefly on the Adjournment to raise the continuing problems of the Bakerloo Line. I am particularly grateful to the Minister for coming to the House at this late hour. I hope that I shall not detain him too long.
Apart from consuming milk, consumers also consume journeys on trains, and in London on the tube trains. I am understandably raising the problems still affecting the line which serves my constituency and adjacent areas—the Bakerloo Line. I have a great deal of sympathy for all users of the Bakerloo Line, wherever it may start, including South London as well as my particular section.
I am glad to see my hon. Friend the Member for Hertfordshire, South-West (Mr. Dodsworth), who may attempt to catch your eye, Mr. Deputy Speaker, to speak in the debate. If so I shall be delighted, because he represents a constituency immediately to the north of mine which is served by Stanmore station, the end of the Stanmore branch of the Bakerloo Line, which is in my constituency. That sets the geographical location. I shall now explain why I raise this matter on the Adjournment.
On 15th July I had the pleasure of accompanying the Chairman of London Transport on a journey on the Bakerloo Line. For various reasons we started at Baker Street rather than at Oxford Circus, although that station has tremendous problems of congestion in the rush hours, and went to Stanmore. It was an embarrassing trip for the Chairman of London Transport. I recall that we waited in the evening rush hour for 22 minutes for a train to Stanmore. At the end of that time three trains came in destined for Stanmore. The first and second trains were grossly overcrowded but we managed, painfully, to squeeze into the third one and went on our journey.
I was extremely grateful to the Chairman of London Transport for making that journey with me. I do not wish to extend vacuous criticism to him. It is all very well and easy for us to criticise

the person who is the obvious fall guy on these occasions, especially when he faces the immense problem of running this extraordinarily complex transport network.
The Bakerloo Line is increasingly becoming the Cinderella line of the London area, just as the Northern Line was several years ago. The Chairman of London Transport has now seen for himself the problems of congestion, which are imemensely embarrassing during the rush hours. There is gross overcrowding. Antiquated rolling stock is in use. New rolling stock has been promised on the Bakerloo Line for far too long. There is inadequate co-ordination at Wembley Park, where a connection is made with the Metropolitan Line. People are often unable to change conveniently from one line to the other because one train leaves the station just before the other comes in. There are immense intervals between trains, not only in the rush hours—the main priority of my comments—but outside them. The gaps between the trains going on from Wembley Park to Stanmore have become an acute embarrassment to my constituents and probably to those of my hon. Friend, who are justifiably outraged about this.
However, as a result of being courageous enough to come and see these problems at first hand, the Chairman of London Transport promised that improvements would be made. He referred to wage increases and improvements in conditions for employees of London Transport which were introduced last August. One accepts that there had been a delay, but substantial improvements were introduced. It was a wage increase of about 25 per cent. on average. I am speaking from memory. There is now the prospect of fare increases next spring of about 35 per cent. on average. Instead of a single journey of 14 miles being purchased for 25p, the distance purchased will be nine miles.
None of the long overdue and now to be expected improvements for my constituents and others in the area—the line serves a very wide area—have yet occurred and there is little prospect of their occurring soon. Other Members of Parliament, apart from my hon. Friend and myself, are concerned about this matter. A Bakerloo Line Users' Committee


has been formed. It was long overdue. I wish it success.
I am extremely alarmed about the continued deterioration. This is an important line serving an important area of North-West London. Up to June 1973 the daily schedule was 42 trains. Between June and October 1973 it was down to 40 trains. After October 1973 it was 32 trains. I think I am right in saying that the schedule is now down to less than 30 trains. That is the regular schedule. It excludes cancellations, particularly the damnable matter of the unannounced cancellations which drive to distraction my constituents and other consumers and commuters.
In a way, it is difficult for us in this House to distinguish between the agony of waiting for up to half an hour, or even longer, to get to work in the morning, and the sheer physical exhaustion of having taken perhaps an hour longer than expected to get home at night to the outer London areas. For those travelling to my hon. Friend's constituency who perhaps have to catch a bus in addition, the problem is even worse because the connection is impaired.
It is time that the future Chairman of London Transport—I am not referring to retirements or changes—got to grips with this problem. I hope that the Undersecretary will be able to make some useful comments and give reassurance to my constituents and the public at large, perhaps by referring generally to some of the problems of London Transport which I shall not have time to mention.
I accept that perhaps the Undersecretary will say—I hope with not too much alacrity—that he is faced with the delightful prospect of having no direct ministerial responsibility for these problems. We know the establishment and structure of London Transport and how the GLC relates to it. But we know that the London Transport Executive has direct operational responsibility for these matters within the overall budgetary decision as decided by its political master, the GLC. We know, therefore, that the relationship of the Government to all these matters is indirect.
I hope, however, that the Undersecretary will be positive in doing two or three things which could be of great help in attempting to renew public confidence

in the future. Although the savage, high, spring fare increases of 35 per cent. have been delayed, I hope that the public may expect an improvement in the service in the future.
The provision of new rolling stock is long overdue. Something must be done urgently to ease the gross overcrowding on trains coming from central London, particularly in the evenings. It might be said that co-ordination at Wembley Park is now slightly better than it was six months ago, but it is still a serious problem. Recently the number of unexpected cancellations has tailed off. I do not know whether this has coincided with the fact that this Adjournment debate has been scheduled, but, judging from the number of letters I receive from my constituents on the subject, this too still is a serious problem.
The Government, through the Undersecretary, can say something to inspire confidence among commuters. They can say how they regard the urgent problems facing commuters in the outer London area. This is not to say that there are not many problems for inner London tube travellers. The Circle Line is a classic example of a line on which operational difficulties are experienced. By contrast, there is the splendid performance of the Victoria Line. In due course there will be the Fleet Line, which will have beneficial repercussions on the Bakerloo Line going out to Stanmore.
The outer London lines such as the Bakerloo Line and the Northern Line are the Cinderellas. The Government will no doubt assert that they have no direct responsibility and that they should not be pressed in this regard. We know the legislation. However, perhaps the Under-Secretary will be bold tonight and say what he would do and how he would react to a suggestion I shall make.
I have referred to the formation of a protest group, the Bakerloo Line Users' Committee, which consists primarily of people who are concentrated further up by Wembley Park and Finohley Road, although some of its members come from Stanmore. There are demands for an improved service and better conditions. There is the possibility of changes in the LTE in future. We know of the great financial problem facing London Transport and its serious budgetary problems for the future.
In view of ideas emanating from the Greater London Council, the Government should give consideration to instituting a top-level professional inquiry into these matters. The inquiry should concentrate on conditions on the Bakerloo Line and similar outer London lines, although there may be advantages in the whole Underground network being studied. Such an inquiry is long overdue. Why should not the outgoing Chairman of London Transport be a member of such an inquiry? Why should not senior officials of the GLC work with officers of the Under-Secretary's Department on the inquiry?
Once the fare increases are implemented next spring there will be a groundswell of public indignation if there is no improvement in conditions and if public authorities, including the Government, are not prepared to say to long-suffering commuters, "We acknowledge our duty to examine all these problems and try to rectify them."

1.0 a.m.

Mr. Geoffrey Dodsworth: I am grateful for the opportunity briefly to intervene in this debate, particularly to express the thanks of my constituents to the hon. Member for Harrow, East (Mr. Dykes) for raising this matter, which is causing grave personal concern to many of my constituents. The problems of the Bakerloo Line are especially oppressive, notably because of the crowded and unpleasant travelling conditions. I understand that there have been signs of an improvement in recruiting for London Transport and that one might therefore expect to see an early improvement in the situation. My hon. Friend and I are looking forward to that with our constituents so that we can report the results of the recruiting drive.
I particularly share my hon. Friend's view about the need for a public inquiry. I recently put a Question to the Minister on this subject, but I was unhappy to find that he felt that sufficient facts were known and that the difficulties were well known. I noticed that there was no recommendation about what action should be taken, and my hon. Friend and I are mostly concerned about action in the interests of those who have to use public transport services.
There is a widespread feeling that not only the London Underground services but public transport services nationally are breaking down rapidly and that, unless speedy and urgent action is taken, there will be a clamour that will have to be recognised more materially than by a debate at this early hour.
I am grateful to the Minister for allowing me to intervene in this short debate on a matter of great importance to my constituents.

1.2 a.m.

The Under-Secretary of State for the Environment (Mr. Neil Carmichael): The hon. Member for Harrow, East (Mr. Dykes) has eloquently described the difficulties that commuters on the Bakerloo Line to and from Stanmore face, and I certainly sympathise with them. Travelling conditions on the line are still far from ideal, which is due almost entirely to the shortage of train guards. I accept that earlier this year conditions were very unpleasant indeed. The hon. Member for Hertfordshire, South-West (Mr. Dodsworth) weighed in with his experiences and emphasised that similar problems affected his constituents.
I was interested in the suggestion by the hon. Member for Harrow, East that perhaps the increase in the efficiency of the service was due to the possibility of this Adjournment debate. I wonder whether we have found one of the secrets of solving transport problems, but I do not think so. If having an Adjournment debate were all that was necessary, we could do something about transport problems all over the country. But those problems are much more fundamental than that, and I am sure that the hon. Member realises it.
In the few minutes available to me 1 hope to explain some of the background and some of the things that have been done by the Government and London Transport to try to help. The hon. Member anticipated me: there is no doubt that it is not a responsibility of the Secretary of State to improve the quality of service on the Bakerloo or any other Underground line. Like other passenger transport executives—Scotland, Merseyside, Tyneside, the Midlands and elsewhere— London Transport is answerable to the appropriate elected local authority, in this


case the Greater London Council. It is for the GLC, not the Secretary of State, to approve London Transport's policies.
Tonight I can answer the hon. Member's comments only on the basis of such information as has been given to me by London Transport. If the hon. Member wishes to pursue these matters, I can only suggest that he does so with London Transport, with which I know he has been in contact. I read the Press account of his journey with the Chairman of London Transport. I think that the hon. Member is quite right—it is good for the chairman to make these journeys, especially during the rush hour.
In view of their enormous responsibilities, chairmen of large organisations such as this must be highly selective in what they do because of the time factor. The Chairman of London Transport obviously knew from the figures and reports he had received that the situation on the Bakerloo Line had to be looked at. This is to some extent an answer to the points raised by both hon. Members about the top-level professional inquiry. It is not being superficial to say that the important facts are known. I think we can work with the facts we know and try to improve the situation from them in this and other transport situations before we need to go to the length of holding a special investigation into the situation. However, we have a long way to go to improve the conditions which we know should be improved with regard to all forms of public transport all over the country.
I should like to describe the situation on the Bakerloo Line in terms of train frequency. It is a tautology to say that frequency is of course of vital importance to commuters. It determines the length of time spent waiting for trains and the degree of over-crowding. Before the present difficulties arose, the scheduled service on the line gave a total of 210 trains a week running in the direction of peak flow in the two hours of the morning peaks. The same scheduled service operated in the evening peaks.
In June 1973 London Transport was forced because of crew shortage to introduce a reduced schedule which allowed for 160 trains in these peak periods. Even then it proved impossible to adhere to this

revised schedule, so that in September of this year only about 120 out of the scheduled 160 trains were running. These unscheduled cuts were inevitably unpredictable, and could lead to long gaps between trains. At that time passengers undoubtedly experienced considerable delays and very uncomfortable travelling conditions. Despite what the hon. Member for Harrow, East has claimed, London Transport makes every possible effort, with the staff resources available, to keep passengers informed of the situation, but unavoidable last-minute cancellations may cause special difficulty. Sometimes people simply are not available to man the services.
The reduction in service frequency and the subsequent late running of trains caused by their overloading have led to the poor interchange between Bakerloo and Metropolitan Line trains at Wembley Park, to which the hon. Member referred. Trains which are scheduled to arrive at the station simultaneously usually wait long enough for passengers to transfer from one to the other, but if one is late the train on the other service proceeds so that the great majority of passengers on it who do not wish to change do not suffer an unnecessary delay and following trains are not delayed. This is really the lesser of two evils.
There has been a change, and I am happy to be able to report that since September the situation on the Bakerloo Line has steadily improved. London Transport is now running 155 of the 160 scheduled trains in weekday peak periods. I think the hon. Member suggested that the daily schedule worked out roughly at 31 trains. This figure is per peak period, not for the whole day.

Mr. Dykes: No ; 31 trains per hour.

Mr. Carmichael: I thought it was important to clear up that point. I should be horrified to think of only 31 trains running during an entire day.
In January it is planned to introduce a revised schedule with 190 trains at these times, although initially London Transport expects to be able to run only about 175 of these trains. In other words, there will be nearly a 50 per cent. increase in the number of peak period trains on the Bakerloo Line in the four months


from September and January. This improvement in the service since the summer reflects a corresponding improvement in the staffing situation. The effects of labour shortages are very obvious on the railways since the absence of a single train guard or driver means that a train will not run. That obviously immediately inconveniences people, particularly those waiting on the platform. In other situations, when one individual does not turn up it may be possible to cover the vacancy. But London Transport knows that when an operator does not turn up, it is immediately obvious that his train cannot run.
In London there is a shortage of suitable labour to man the public services, and transport industries find it particularly difficult to attract staff because of the unsocial hours worked. The calibre of staff on the railways must be high if safety standards are to be maintained, and the need for selectivity adds to recruiting difficulties. The pass rate of would-be London Transport guards after the initial eight-week training course varies between 50 per cent. and 70 per cent.
Recruiting for London Transport is especially hard in North and West London where the traditional pool of railway workers has been tapped by alternative employment, mainly in the light manufacturing industry in which the hours are not unsocial, whatever the wages may be. The Bakerloo Line has therefore been particularly badly hit by staff shortages because a substantial part of its labour force is based at Neasden depot.
The pay award made to London Transport workers as a special case last August has already made a marked impact on the acute staff shortage which persisted throughout the summer. Six months ago there was a shortage of 360 trainmen on the Underground; this has now been reduced to 160. Recruitment of train staff is now proceeding at twice the normal rate for the time of year, while staff wastage due to retirement and people leaving for other reasons has remained fairly constant. Because of the time taken to train staff, present rates of recruitment should ensure that the quality of service on the Bakerloo Line will continue improving.
The condition of the rolling stock on the Bakerloo Line also makes it difficult

for London Transport to provide a completely reliable service. The stock, built in 1938, is the oldest operating on the Underground and inevitably more liable to break down than modern stock. Although the stock is being reconditioned, work has been delayed by the shortage of skilled craftsmen. This is what we are up against all the time in public transport. All the vehicles in current use should be replaced by 1982 at the latest. It is an ongoing programme, and therefore improvements will be seen as time goes on between now and 1982.
So far I have been talking about the Bakerloo Line as a whole. But the hon. Gentleman is primarily concerned with the Stanmore branch. As the House will know, the Bakerloo Line divides into two northern branches at Baker Street. Inevitably the number of trains that can be run on each branch is only about half of that on the stem line between Baker Street and Elephant and Castle, which governs the total capacity of the line. The repercussions of the service cuts have been bad enough on the stem line, but in terms of intervals between trains they were obviously twice as bad on the branches.
The stem line too has its problems. The hon. Member has drawn attention to the overcrowding at Oxford Circus during rush hours. This was a problem when I first came to this House in 1962. The difficulties at Oxford Circus have existed for a long time, and I do not suggest that the situation is simply because of staff shortages on the Bakerloo Line, because staff was more easily available then. The only way in which this overcrowding could be substantially relieved in the short term would be by the staggering of working hours to reduce the numbers using the station at the height of the peak periods.
The only solution to this problem of the branches and that of overcrowding at Oxford Circus is a long-term one but one which, I am glad to say, is well under way. Stage I of the Fleet Line, which is planned to open in 1977, will take over the Stanmore branch of the Bakerloo Line from Stanmore to Baker Street and then proceed to the Strand via Bond Street and Green Park. This will mean that train frequencies can be increased on both northern branches of the present Bakerloo Line and overcrowding on the


stem section and at Oxford Circus Station could be relieved.
The Fleet Line will further benefit commuters on the Stanmore branch through its effects on staffing and rolling stock. Trains on the line will be one-man operated and the rolling stock used will be modern—initially new vehicles currently in use on the Northern Line and eventually new stock built specially for the line. Cancellations due to staff shortages and defective stock should be minimal. Thus the problems facing commuters on the Bakerloo Line to and from Stanmore have already begun to be eased.
The hon. Member may claim that the recent decline in the number of complaints London Transport has received about the line from the public is an indication that commuters despair of any improvements being made. Although he spoke of the Bakerloo Line Users' Committee, there has been a reduction in the number of complaints received by London Transport. It could be a matter of fatigue and a feeling of apathy on the part of commuters, but I consider that it is due much more—

Mr. Dykes: I do not want to give the wrong impression. The number of complaints that I am receiving is not reduced.

Mr. Carmichael: All 1 can say is that the number of complaints that London Transport is receiving is reduced. I think that the figures I have given have some significance in the short term. The number of complaints is reduced because the reason for complaint has been reduced. The hon. Member for Hertfordshire, South-West suggested that there had been an improvement, especially recently.
I have tried to show that, given the labour situation in public transport, which undoubtedly is an acute problem, especially because of unsocial hours—I think that we must accept that we have to pay people for working unsocial hours —future prospects are bright. The opening of the Fleet Line should guarantee commuters in the north-west of London one of the best Underground services in London, and I hope—

The Question having been proposed after Ten o'clock on Monday evening, and the debate having continued for half an hour, Mr. DEPUTY SPEAKER adjourned the House without Question put, pursuant to the Standing Order.

Adjourned at seventeen minutes past One o'clock.